Car-company wisdom these days is to pretty much overwhelm buyers with options. But over at Ford, they’re going the other way. And the aircraft cupholder is responsible.
Alan Mulally, the Ford CEO, used to be at Boeing. He’s spent the last two years carving all possible complexity out of Ford. Selling Jaguar, Land Rover and Aston was part of that drive for what he calls ‘clarity’. But there’s more.
He wants to simplify the options line-up. Unlike Audi’s or BMW’s strategy of offering thousands of extras, he wants to simplify things into packages.
‘At Boeing we used to have 47 different cupholders for the cockpit of the 747. Every airline had different china so they wanted a different shape. And they all had to be engineered for 16g!
‘But then airline deregulation happened. They had to cut costs. They couldn’t afford to be fussy any more. Then it was just the one cupholder.’
He wants to bring that thinking to Ford. He’s looking at things like centre console colours and trims, seat fabrics and so on. He wants to cut out 80 percent of that variation, especially in the American market. It makes things cheaper and simpler at the factory, he says.
And he reckons the dealers would prefer it. They get a potential buyer come in asking for a spec he’s seen in the brochure. The salesman has to say, ‘Sorry we don’t have one like that, so how about this one that we do have in stock.’ The customer looks a bit crestfallen and demands a discount for not getting what he’s set his heart on.
If you don’t offer the choice, says Mulally, buyers don’t miss it.
Nice theory, but of course the Germans, with their build-to-order systems, use all those options as rich profit opportunities.
And they will come in any color as long as it’s black.
I wonder if this guy has been to his own product websites. You have a lovely choice of three shades of white and four shades of grey. That’s not choice to start with.
But these are the clever ones who always stop production of whatever car they have that’s selling the best!
Yup, the Germans are quick enough to say “NO PROBLEM, sir! That’ll be $xxx for that cupholder style, just sign here…”
- Ford is discovering this now? Toyota has been doing this for years. We have three Toyotas, all of which share the same dashboard, center console, and instruments.
How about just building a car thats economical roomy inside good looking and wont break, like they keep forgetting to do instead of deciding what colour to make it in?..
Trouble i see is it’s not choice at all… it’s confusion. people just plain don’t know what they want, they get confused buying a sandwich when they’re asked what bread because it hadn’t crossed their mind. They knew they wanted bacon, lettuce and tomato, and it’s the same with cars! People go to buy a car with a particular engine maybe, they have an idea of the number of seats because it’s around the number of people in the family, and they might know the colour. They only start to consider the various material options for the volume knob on the stereo BECAUSE CAR COMPANIES LET THEM.
i agree with ford, when someone comes in and asks for a family saloon, the answer should be “ok that’s a mondeo, it’s got air-con, 4 seats and an engine. You put the petrol in the hole on the side, push the pedals to make it go, and it comes in black… sign here.”
Sorry, but I don’t like that idea. Unless ‘variation’ is demoted to the ‘optional extras’ list then I think you’ve shamelessly used fancy, sugar-frosted words and philosophy to cover up the fact that Ford’s feeling the credit crunch and want to cut costs without firing 3,000 people.
Let’s say I go into a Ford dealership. I can tell you right now that I want that new Focus RS that’s due to come out soon, so I go in thinking about ordering one. I want one in neon blue instead of the lime green release colour, with matching interior (again, instead of the lime green seats matching the release colour). I want it with Sat Nav, I want it with cruise control and with that thatcham locking system.
Scenario A says this: “Yes sir, those options come up to £xxxx on top of the base price, bringing it to a total of £xx,xxx. Would you like some hot chocolate and a cookie whilst we process those forms for you sir?”
Scenario B says this: “Tough s**t, it’ll be a boring grey interior, none of what you asked for is available, but you can have any colour so long as it’s black. Sign here.”
If Mr Genius CEO is doing this to save/earn money, he should do it that way. Why? because basic models of his cars will be cheaper to make as they won’t be laden with luxuries, and the customers who really want the nice toys can and will be persuaded into paying the extra money for them. Not only is that cost-cutting, but it’s also money-making. Getting rid of the choice would be financial suicide – we the customers would just buy cheaper cars from cheaper manufacturers. I hear Peroduas are pretty good these days…
Oh nice!
We can choose the look of our home.
Why we can’t choose the look of our car, Mr. Mullaly?
Go study JIT and Kanban!
Ford needs to scrap it’s north american line-up (pickups aside)and fire the north american design teams and just sell it’s euro cars over here.
problem solved.
It wont change much. I looked at a brand new 2008 ford fusion to possibly replace my 2005 ford focus, and when I got into the fusion I thought it was the same car. Same switches, vents, radio. I’ve heard of brand loyalty but brand brainwashing is scary. But never fear, I can get a crap interior made of cheap plastic from any of the big three. Never thought I’d look at a Hyundai interior and think “Nice”
It seems car makers had a good thing going back in the 60s. Every car came from the factory in basically the same cookie cutter stipped-down way. It was at the individual dealers where many of the options were added on. Upgraded radios, mag wheels, aircon units, and so on. Why not go back to this system? It would make things simpler and more efficient for the factory without the customer having to drive the same car that everyone else has.
Look at GM…Next thing TATA will buy them. Its about Survival fellas
But it’s not about eliminating choice altogether – it’s about providing a simplified set of choices of things that customers have actually asked for.
I’m all for it. I agree that too much choice is overwhelming.
Taking the sandwich example, if I think “I want a BLT” and then I get in the shop and there’s 20 types of bread, 8 types of spread, 9 varieties of bacon, 4 types of lettuce, 8 types of mayonaise, 12 types of tomato, and 8 different types of box to put it in, I am never actually going to get my sandwich.
That’s the sort of extreme Ford has at the moment.
The opposite is “I’m sorry sir, we only sell cheese sandwiches”.
This is clearly very bad.
Ford is trying to go somewhere in the middle, and I think that’s just where a qood quality and value mass market manufacturer should be.
I think it is all part of buying a car as to what you can do to it to personalise it. I bought a Maverick from them a few years back and was asked what colour to which I replied black with brown leather interior. I was then asked for a secondary colour which i replied Black with brown leather interior because as far as I am concerned if I am spendin £15000 on a car then i want to get what i want not to be told what I can have.
If you want a huge range of choice, you’ve got to go premium and pay for that choice.
To get to a really good value vehicle, like £15k for a 4×4, you’ve got to get economies of scale, even with JIT and Kanban.
Modern Fords have tonnes of options available, but they’re never going to be able to provide unlimited choice to cater for every single requirement, and still come in at such a good price.
Choice is what we all expect these days – and thank goodness too. What’s worse than sitting inside your newly delivered car for the first time and realising that the view is identical to the one you’ve just been glad to get rid of?
By all means fit identical air bags and other hidden equipment across the range, but as most folks’ cars are part of their own personality, give them the chance for it to shine trough.
I sort of agree with comment #13. I want to see an options list offering sat nav, cruise control, button ignition, sun-tint windscreen, and all the usual stuff you’d expect. But I don’t want to see one that offers me 15 different shades of black and 36,000 colours to choose from altogether.
Rolls Royce claims – with pride – that they offer such a range of colours (36,000 or so). who honestly sits there in the showroom with the worlds largest colour chart and thinks ‘hmmm… do I want Scarlet Red or Brilliant Red…’?
That said, i had a go at ‘building your own porsche’ on porsche’s website (who HASN’T done that yet? seriously…) and I quite liked the idea of choosing from 6 ’standard’ colours, with another 6 being special ‘premium’ colours that nobody seems to buy. Even if nobody buys those premium colours, it’s nice to have them there to tempt you. It’s like if you buy a Ferrari – 90% of first time ferrari customers will choose red, but we like having the choice of black, grey, yellow, white, etc.
though for all this choice, i’d go for black every time, especially if it were a sports car.
ford is going knocked out for that if it is not well manged which they will probably not. By the way though you might as well get a plastics engineer for interior electronics division similarly instead if he is so needy for it since its a bit better than that hes saying.
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I’d like Ford to give me the option of buying a nice new RWD Capri, but instead they seem dead set on trying to flog boring city cars in all kinds of stupid colours.
I for one second Wobbletastic’s comment. They seem to have a huge range of egg shaped MPVs and psuedo-SUVs, however they have no interesting coupe (Capri) or big RWD barge saloon (Granada).
hat about the money you will get for your “no options” car whet you want to sell it on
Great idea Ford, afterall the 500,000 different combos of the Fiat 500 are proving such a failure….
Ford is worth less than $2.50 share lately. It doesn’t look like Mr. Mulally is going to be able to do anything to fix that (really, it looks as though he may well put the final nail in the coffin). GM may be considering buying, or merging with, Chrysler. The old saying “what’s good for General Motors is good for America!” may ring true in the near future, for the fact that General Motors may end up being our only manufacturer.
I think if you have 2 or 3 trim levels for each model then that should suffice. I like the idea of a limited number of dealer fit options too.
Let us see what they come up with.
I loathe the ‘trim pack’, concept.
You end up with one or things you really want or need, but are forced to pay for other items in the pack that are superfluous or downright irritating.
No, I agree since it’s Ford we’re talking about. They’re not Mercedes, BMW or Jaguar! Ford was always about motors for masses, so actually its a return toward the root of their business. This move actually improves the choice in the market as a whole. You can choose either an upmarket, we’ll sell you anything and everything, luxurycar, or you can go back to basics with Ford.
And let’s face it, very few cars are actually truly basic these days!
I had an Austin Metro 1.0 City, and it didn’t come with a rear wiper, parcel shelf or radio – you had to go high in the range for that kind of luxury!
Many previous commenters don’t seem to have bought a new car from a Ford dealership lately.
You look at the car you want, a dealer comes over.
He gives you a brochure and some time to study it. Then you go back to him and they’ll devote time to helping you find the options you want.
Most dealerships have a huge demo lot so you can see most of the options available anyway.
Besides, this new system sounds better. If you only offer people certain options, they’ll pick out of those.
E.G. If you offer the dashboard in black, red or blue, no-one will say “can I have a green dash?”
Crisis for the poor….Opportunities for the rich, if almost no one is able to buy; the ones that can, get the lowest prices. The question is, all the options offered it’s nice if you can wait, most of the time when you decide to buy a new car, can you wait for the model you’ve chosen at least 3 month?… or get to the one available right now. But think about it, do you believe to make a sport version more powerfull of a regular hatchback for example really worth to pay the double of the less powefull model? In fact I believe not, but it’s a way to make huge profits, an easy example Mercedes SL 65 AMG copmpared to the SL 500, or Golf GTI compared to the 1.6. Why in the U.S the same model we find in Europe cost half of the amount asking fot it here…
Shame on you guys! I think this is a great idea! Bring price of the car down and still has what a driver needs! A seat, a steering wheel and a freakin knob that make sense with an actual “On” and “Off” for the freakin radio. Car companies spoiled us offering gazillions of optons, but all I really need is a nice seat with a nice black leather on it, and not something with, “Oh sir, this has an optional mink leather seats…”.
Options is nice and all, but in the end, I just want to drive.
And for the people who still insists that they need an optional auto tranny for my Subaru STi should be run over!
Do you honestly think the cars will be cheaper with a limited spec???????
I agree with #32 + #26
They’ll use it as an excuse to sell you a load of crap you don’t need. And Ford are trying to bring FACRTORY costs down. Not retail prices. If they lower the costs at production and keep the same retail price they’ll get a bigger profit. I still reckon more choice + more costs is the way to go if they REALLY want profits though, lol.
What if I want to mix ‘n’ match things from different packs? Then I’d probably have to pay extra to do that, if they’d even let me.
They should just have an easy to read checklist.
I’m not so sure about that..
Hi Jeremy, James and Mr Hammond
Could you guys please make a podcast on itunes
I ve just been reading topgear and it says at the end of jeremys and and hammonds columns that topgear is back on the 26th of november but it says on the site it is back on the second of november? any answers?
There’s a sporting event of some kind on 26/10, so it’s been put back a week.
From the company that brought one of the finest, stylish American cars that the country went nuts over, the fully customisable Mustang, comes a complete U-turn in the wrong direction. What they need to do is stop unions, etc pushing wages up so that the labour is more cost effective, and build cars with Japanese levels of quality and German levels of customisation. The brand is doing badly because Ford are not cool anymore, even the new GT can’t save them because their normal cars are so dull and poorly made. Also why now? Brands that do well in the US are Mini, Nissan and Toyota. So they either need to offer more customisation to consumers or more quality. Cutting both of these options out would send them spiralling straight down into Kia and Hyundai territory, already the fastest growing car company in the world! We won’t need a black box to determine why an ex-Boeing exec helped Ford fail if they’re going down this route. Crazy. Absolutely crazy.
This isn’t such bad business actually, they’ll make money out of this.
Rather than pick n choosing your options, you’re locked in to buying set combinations.
You want cruise control? Then you get (and have to pay for) sat nav, rear parking sensors, bi-xenons, curtain airbags. So now rather than getting $300 for the cruise control, Ford is getting $2000 because you’ve had to get the whole lot.
Similarly, you want a stereo upgrade? Then you also get electric leather heated seats, upgraded climate control etc. And you’ll pay more for it.
Yes some people might not buy a Ford or might go without an option they would have normally gotten, but that will be more than made up for by people who do buy by the package. And it can be a benefit for people who might only get 2-3 options, because now they are getting more add-ons for only slightly more money, giving them a better car than they would normally get.
Build a car that appeals to the market because it’s good and desirable and they will buy it, simple as that. Who buys a car because it’s a particular shade of silver? You buy the car first and then choose the colours/options. Also, I can’t abide these companies which allow you to buy a basic model and then option it to the hilt to make it look like the top model i.e. Audi. I remember when Fords came in “L”, “GL” and “Ghia”. That was it. Good on you Ford for being sensible.
There is nothing wrong with limiting the number of minor options available that make no functional difference. If the car is a really well built model people will still buy it if they do not have a choice of colors for the radio buttons. However, their styling in the American market is awful. Whoever thought of that 3 or 4 bar grille should be shot. The Fiesta will be sold in America, but they are modifying it to look like a Taurus. The Euro version is so much nicer that I do not understand why they wish to make it look like a poor selling car that no one wants.
some people have missed the point here i think. its just unnecessary and pointless choice thats being removed, like having 5 shades of the same colour or having different types of seat fabrics. instead, there will be only one red and either pleblon or leather seats. options that people are cncerned about like adding sat nav or air con will remain. i think its a good idea!
Well this guy obviously knows what he is talking about. He worked in the airline business. And we all know how much we enjoy our time spent on a plane don’t we?
What they mean is that instead of 7 different radios, you get three. Keep the big tooth design for the big stuff, but why don’t we get the Ford Falcon that the Aussies do? That thing looks great and is quick, Ford wake up and give the world an chance at that car.