the bottom line

Pinch those pennies too hard, and something’s gonna break

angus mackenzie

MASSIVE LOSSES, collapsing market share, make-or-break deals with the UAW, tough-guy stockholders, rumors of a management shakeup: GM’s been hogging the bad news coming out of Detroit in recent months. But there’s a quieter disaster going down in Motown: Ford. The Blue Oval’s in a bad, bad way. Its share of the U.S. market has plunged from about 24 percent to just over 18 in just five years—and that’s before sales stalled in the aftermath of Katrina and the winding back of the so-called “employee pricing” incentive programs. And its quality problems are threatening to spiral out of control: Quality-related costs increased by $500 million during the first nine months of 2005 compared with the same period the previous year. Chairman and CEO Bill Ford made the best of its $248…

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MotorTrend (Digital) - 1 Issue, January 2006

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