Speaker: Nick Scheele
Title: Chairman, Ford of Europe
Theme: How brands will drive Ford's recovery in Europe
Ford of Europe is launching a brand offensive designed to restore luster to the blue oval, said Ford of Europe Chairman Nick Scheele.
The brand drive is the latest facet of Ford's ongoing European restructuring. Ford's European market share has declined from a peak of 12.1 percent in 1994 to a predicted share of 8.7 percent this year, he said.
Scheele aims to rebuild Ford with a two-pronged offensive: tripling the number of new products in the next few years and improving efficiency by 50 percent.
Scheele said that Ford had 'barely ticked along for the past decade' in Europe and admitted the unit's slender profits in recent years amounted to a 'totally untenable situation.'
'The only way to get out is to bring product to market that people want to buy. We've got to get costs under control as well,' he said.
Since Scheele took over as chairman in January, Ford has been reassessing everything it does in Europe. It has announced some drastic cost-cutting measures, including the termination of car assembly at its Dagenham, England, plant.
Ford has had the lowest utilization of plant capacity of any major European manufacturer: 71 percent over the past five years compared with an average of 85 percent among Ford's five main competitors, Scheele said. Ford will push capacity utilization above 90 percent within a few years, partly as a result of a product offensive that will feature nine new products a year for the next three years, Scheele said. Three of those will be 'segment busters,' he said.
Those new products will be the core of Ford's brand turnaround strategy. Ford's image has been inconsistent from one European country and another, Scheele said. He blamed that partly on the fact that brand messages in each country have been driven by the national sales companies.
'They need to be driven by the brand,' he said. There is an 'absolute imperative of consistency' when it comes to brand image.
To get the message across, the company's leaders from around Europe have met in recent weeks at headquarters in Cologne. They will present the message about the Ford brand to employees and customers.
'People have to viscerally understand. The brand image has to drive the creation of the vehicle. The brand has to be obvious to consumers.'
Ford must address its distribution system as part of the restructuring, Scheele said. European operations will take advantage of all electronic commerce partnerships coming out of Ford headquarters in Detroit, he said.
Ford also is saving money by streamlining regional back office functions. Those functions have already been combined in the Nordic, Benelux and central European regions. Ford is moving to fewer dealers with larger territories, Scheele said.
The brand drive is being led by European marketing chief Earl Hesterberg, product development chief Martin Leach and Murat Yalman, newly named vice president of product marketing for Europe. Yalman is responsible for Ford's vehicle brand management teams and product marketing communications.