Discussing Ford's new Taurus and what it means for Detroit's future on July 16 were George Bell of Ford and Katie Kerwin of Business Week.
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OnlineHost: Good evening and welcome! Business Week Online is bringing you its regular Sunday evening conference, tonight with a discussion on one of America's favorite topics -- cars. The Cover Story in the current issue of Business Week (July 24) tells all about the snazzy new Taurus in Ford's future -- and what it means for the company, for its hot competition with the Honda Accord and Toyota Camry, and thus for Detroit's standing in the auto wars with Japan.
Here to field your questions about cars, the Taurus, Ford, the U.S. auto industry, and world competition is a special guest, George Bell, the chief program engineer for the new Taurus and Sable. A 29-year veteran of Ford, he has been working on the project since 1991. Before that, he was vehicle engineering manager for the Ford Crown Victoria and Mercury Grand Marquis. He's a graduate of the University of Michigan in aeronautical engineering. George Bell's screen name is FordsBell.
Also on stage with us is Business Week's Detroit bureau manager, Katie Kerwin (KatieBW), the principal author of the Cover Story on the Taurus. She has been in the Detroit post for three years, after joining the magazine as a Los Angeles correspondent in 1989. She's no stranger to Detroit -- she spent three years at The Detroit News before coming to BW. She's an alumna of Notre Dame (BA in American studies and modern languages) and the Columbia Graduate School of Journalism.
The moderator of tonight's conference is Jack Dierdorff (JackBW), consulting editor of Business Week Online. And now on to our car talk with George Bell of Ford and BW's Katie Kerwin -- and discussion of the questions you send to the stage via the Interact button.
JackBW: Good evening to everyone on AOL. And hi, George Bell and Katie Kerwin. We're delighted you could join us, George.
FordsBell: Hi, Jack and Katie. Glad to be with you.
KatieBW: Hello, Jack and George.
JackBW: Katie, you can ask the first question.
KatieBW: Taurus is already America's best-selling car. So why did Ford decide to change it? Why mess with success?
FordsBell: The answer is that in 1992, when we were deciding the degree to which the car had to change, the imports were gaining a lot of momentum, and we didn't feel the present design would carry us through to the end of the century. We have two plants committed to build only this car, and we had to keep those plants full.
JackBW: Zonermania, a Midwesterner and Aquarian in the audience, asks this.
Question: Will the price still be under $20,000 for a well-equipped Taurus?
FordsBell: Yes, it will. It'll be about $700 under $20,000.
JackBW: MEMFISMAN has this one.
Question: Is there a plan for a SHO wagon? Get me to the PTA on time!
FordsBell: We're studying the possibility. And that's as much as I can say right now. I might add that we have built a couple of prototypes.
JackBW: DHell12441 asks you this, George.
Question: George, the new design is exciting. My fear is that the car seems to be priced several thousand over the competitors, even though the car should be excellent. Isn't there a point where price will turn others to competitors, especially in a market with declining wages?
FordsBell: We feel that by keeping the price of a well-equipped car -- one similar to what three out of four buyers purchase -- under $20,000 we're being very aggressive on price. The only cars priced under us will be those without the quality and craftmanship we're offering -- and features.
KatieBW: Are you worried about competition from the new Camry coming in a year?
FordsBell: I think we've got a big advantage because of the strong yen. And it's up to Camry now to lower the cost of their car without hurting the quality.
JackBW: KevinD40 throws this one at you.
Question: I own a used-car wholesaling company. We deal with '85 to '90 models mostly. The Tauruses and Sables that we get in for these years are usually very junky and in need of extensive repairs. Specifically, transmission, power-steering problems. What's up?
FordsBell: On the new model, we've addressed the transmission concerns to a considerable extent. We feel we understand the issues with earlier cars, and we've corrected those. Additionally, the power-steering system is completely redesigned and will be more reliable than the old system was.
JackBW: George, try this one next.
Question: What do younger buyers, who seem to favor imports, want in a car?
FordsBell: They're looking for style, for performance, for features and craftsmanship. And they're looking for a vehicle that doesn't degrade over time.
KatieBW: George, do you think the right-hand-drive version of the Taurus will sell well in Japan, even though it's bigger than most cars there?
FordsBell: Yes, I do. I believe in particular that the Japanese will buy the wagon, because it's unique in Japan -- no other manufacturer has anything like it. Our sales projections for Japan, I believe, are very conservative. Ford of Japan has stated that their aim is to sell 12,000 Tauruses. I think we'll ship many more than that.
JackBW: George, Mel Y N CA posted a comment on our message boards right after reading the Taurus story online. Here's the gist of what he said. Comments?
Question: What is this fascination with the ovoid? I definitely prefer crisp lines to the jellybean look of the mid-1990s. Ford seems to be making the ugliest car (Taurus) even uglier.
FordsBell: We'd be very worried if our design pleased everyone. Our research shows that if an early design pleases too many people, it doesn't have any legs. We'd like to have a design achieve universal acceptance more toward the middle of the model run.
JackBW: RugR sent this question to the stage.
Question: There are no doubt millions of us out here who have become dependent on Japanese reliability in our automobiles. We've heard so much "quality improvement" talk from the Big Three over the past 15 years. But the problems persist. What concrete steps are you taking to make this true?
FordsBell: It's hard to give that a quick answer. One answer is that we're bringing everyone involved in design and manufacturing of the car onto the product team 3 to 3.5 years before the car is produced, and that includes specialists -- union guys as well as plant supervision -- from the assembly plants. The wider perspective you gain with this team process results in a higher-quality car design. Additionally, we have a lot of data on the issues with the old Taurus, and every single one was addressed with the design of the new car. We feel that we'll be competitive with the best out there for quality.
KatieBW: How did consumer research influence the development of the new Taurus? Can you give us some examples?
FordsBell: We did functional research at a very early stage -- as opposed to styling research. And we discovered that customers wanted a smoother-shifting transmission, and this had a great deal of influence over the transmission design and development.
JackBW: DHell12441 brings this question to the party.
Question: Will any other car be based on this platform? George, please.
FordsBell: In the future, there will be derivatives. And that's about all I can say.
KatieBW: Analysts think the next T-Bird, Lincoln Continental, and Crown Victoria will derive from the Taurus platform,
FordsBell: Whoever heard of a front-wheel-drive T-Bird? That's not correct.
JackBW: How about this query from YABOU?
Question: Since acquiring Jaguar, what influnce has Jaguar had on Ford as far as design? I understand the Duratech 4.3 is a Jaguar-designed engine.
FordsBell: Jaguar is benefiting from its association with Ford, not the other way around. From a styling standpoint, we feel it's best to leave Jaguar alone. But they have benefited from their association with Ford in manufacturing and quality. By the way, the Duratech was designed in Dearborn by Ford engineers.
JackBW: AxWx from South Miami Beach asks about an interesting option.
Question: Will satellite navigation be available on the new car?
FordsBell: Re satellite navigation, I can't say never. But it isn't written into the plan at the moment.
KatieBW: George, you mentioned that lots of folks were involved in developing the new Taurus years in advance. How did this team process differ from the way Ford used to develop cars?
FordsBell: I guess the easiest way to answer that would be to say that there used to be 90 people working on parts for every 10 working on the vehicle. Now we've just about turned that around. The team concept just automatically focuses everyone's attention on the total vehicle.
KatieBW: Why does it matter if everyone on Team Taurus is working under the same roof or not? Especially in these days of high-speed communications?
FordsBell: Because you can all see the flag. It's a psychological allegiance. If you have a bunch of people working in a building where parts are designed, people will care about parts. If you put them in a building where the car is designed, it's much healthier -- people focus on the product we sell the customer.
JackBW: MRoot, a systems specialist in Washington, D.C., asks this.
Question: I've just joined and was wondering if anyone has addressed the future of the electric car.
FordsBell: I can only give my personal position, not the corporate position. I don't think they're efficient from a total energy standpoint. I'm not in love with the concept of electric cars as long as we're burning coal to make electricity. I think we're certainly going to see electric cars someday, however, when there are other means of generating electricity, such as solar, wind energy, etc. Then, electric cars will make a lot of sense. But first you have to get rid of coal-generated electricity.
JackBW: WIXTTV9 offers the next question.
Question: How did the development of the Taurus differ/resemble the process for the "world car" (Contour) program?
FordsBell: I don't believe I can answer that -- I'm not that familiar with the Contour. The Taurus was the first to use the new product-development process at Ford, which we call World Class Timing.
KatieBW: The world car was developed jointly by engineers and designers on two continents for sale in the U.S. and Europe. Surely that created a different process overall.
JackBW: Here's one from FORDFIXER. First, tell us laymen what EDIS is.
Question: Hi, George. I've been a registered Ford technician since 1970 and have a question regarding EDIS. Why is Ford holding back on incorporating EDIS in all their vehicles when it appears to be a very reliable system?
FordsBell: EDIS isn't my line of expertise. But the system is going to be in the new Taurus.
JackBW: A little light relief here, from MEMFISMAN again.
Question: Is it true that Tauruses are males while Sables are female?
FordsBell: I think there may be some truth to that. The Taurus to me has a more masculine image than the Sable, which is a little more formal and glamorous. So the two cars strike me the same way. So do the names.
JackBW: Take this next, George.
Question: A successful launch of the new Taurus/Sable should capture market share from the Chrysler LH line. Do you agree? What other programs might be displaced by a Taurus success?
FordsBell: We identify probably a dozen competitors, all of whom will lose if we win. The Lumina is one, the LH cars. We certainly hope to take some out of the Camry volumes. And the Accord. Even the Buick Century and Regal and the Oldsmobile Cutlass. These are all in, or approximately in, our segment.
KatieBW: The Japanese are cutting back on the content of their cars. So why did Ford decide to go the other way, and add engineering refinement and features to the new Taurus?
FordsBell: The car has got to be perceived as a good value in order to be successful. It's possible that the Japanese may cut back so far that their cars won't be perceived as good value.
JackBW: MBrinks wonders about this.
Question: What is the real difference between a $40,000 European sedan and your $20,000 Ford? Materials, R&D, engineering? Why such a large difference?
FordsBell: Well, the $40,000 European vehicle is what it is because of the weak dollar. With two assembly plants committed to Taurus and Sable, there just aren't enough customers who will pay $40,000 even if we could design a car with that much value in it. We had to have a $20,000 car because we're going to make 500,000 to 600,000 of them.
JackBW: George, at least two people have asked about "Ford 2000." Here's one of them.
Question: How will Ford 2000 affect a project like this in the future?
JackBW: Again, for us, what's Ford 2000 first?
FordsBell: Ford 2000 is the code name for Ford's reorganization to become a world car company and No. 1 in the world. Our project affected Ford 2000. The process that Ford 2000 will use to develop a project is very similar to the one we used for Taurus/Sable. In fact, Taurus/Sable was the blueprint for for the Ford 2000 product-development process.
JackBW: Bunzk in Boston has perhaps the $64 question for the success of the new Taurus/Sable.
Question: How does Taurus intend to beat the Japanese car aficionado? To get them to try it?
FordsBell: I know we are planning a very extensive ad campaign in the fall -- the biggest one we've ever mounted. If we can get people to drive the car, we'll get the sale.
JackBW: Well, good luck with your marketing now that the development is done, George. Thanks so much for being with us.
FordsBell: It's my pleasure to be here, and it's been a lot of fun to talk to people around the country on a subject that's dear to my heart. If you try the product, you won't be disappointed.
JackBW: And a personal thank you to you, Katie Kerwin.
OnlineHost: Thanks to George Bell of Ford, Katie Kerwin of Business Week's Detroit bureau, and all the BW Online team for this conference. And thanks to all of you on AOL -- with apologies to those whose questions we didn't have time for. If you'd like to continue the discussion, we invite you to move to the BW Online Chat Room or post comments and questions on the BW Online Message Boards (try the Companies & Industries or Personal Business categories).
Transcripts of all BW Online conferences are available soon after the event (look under Talk, Special Events, or Search BW). Join us here in BW Online on Monday, July 17, for a session on the glass ceiling and other women's issues with Mary Mattis of Catalyst (Odeon, 8pm ET) and on Tuesday, July 18, for a conference with the founders of Yahoo, the hot Web site (9pm ET, Bowl).
And look for the online-only story about Yahoo in The Computer Room, which is the newest area of BW Online, under What's New on our opening screen.
There will also be a BW Online Interview with the Author on Wednesday, July 19, with Michael Schrage of "No More Teams!" (9pm ET, Bowl). Plus, of course, every Sunday at 9pm ET, there's a conference with BW Online here in the Globe. Thanks again and goodnight!
Copyright 1995 by The McGraw-Hill Companies, Inc. All rights reserved.
