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Ken Gratton1 Oct 2014
NEWS

Ford forfeits rematch with Holden

GM brand is no longer the biggest game in town; blue oval has sights set on Toyota – like everyone else
Forget taxis and police cars – or even bright-liveried MICA ambulances. Forget too about the age-long Ford/Holden rivalry. 
Ford Australia after the end of local production stands to be a very different car company from what we've known. 
Communications & Public Affairs Director for Ford Australia, Wes Sherwood, told motoring.com.au last week that the company – like Holden – would be targeting Toyota's massive market share for conquest. It's an obvious strategy, and one already followed by volume-selling full-line importers. 
"We're going to take on a different shift and tone and so the traditional sort of Holden/Ford type battle probably will not be to that degree," Sherwood observed.
"We have to target Toyota... not just because they're the sales leader, but also... perception of the brand [and] who the leader in efficiency the perception is. We have the credentials to stand up and impede them in a lot of places, and so we're going to; you're going to hear a lot more about us sort of taking on Toyota or Mazda, because that's where customers' mindsets are. We've got to get on that shopping list."
Challenged as to whether Ford Australia wants to be another Toyota, Sherwood demurred. 
"When I say we're going to target Toyota more, it is not... to do Toyota a little bit better."
"Toyota captured the imagination of people just because of the quality. That has served them well over decades, but now people are looking at every car. Every automaker is building quality cars.
"So now there has to be a different discussion, and what people perceive as quality these days is not, you know, how well you screw the car together. It's about fuel economy and the safety technology and those kinds of things, and that is where our vehicles stack up very well to Toyota and anybody else. But we've got to get that message across."
The company is already reinventing itself at dealership level. Repositioning Ford's brand image will go beyond the dealership experience however. Already, an aggressive new TV commercial campaign invites prospective customers to take 'the challenge' of testing a Ford against one of its rivals. The danger of drawing the attention of the buying public to a competitor's wares is that you're effectively promoting your competitor. Sherwood admits the risk, but also foresees benefits. 
"We actually show the competitive vehicles in the ads. And there was a lot of that discussion around 'Well, how do we show them?' 
"We can't glorify their vehicles, but we've got to show that we think our vehicles stand up... 
"When you're challenging, you do have to... tell people why you think you're better than [the competitor]; you see it with Apple all the time. 
"Everybody challenges the leader. You know, it's tried and true."
All that brand rebuilding will encompass product as well as marketing – with the potential for all sorts of fall-out
It may sound like it's unexplored territory for the blue oval brand, but it's actually not, as Sherwood tells it. The situation in which Ford Australia finds itself currently is not that far removed from the challenges that faced the parent company up to and beyond the GFC, he suggests.
"I've only been here nine months now; what was striking to me were the similarities with what we went through in North America – almost 10 years ago now," he told motoring.com.au last week. 
"That was a big moment around the financial melt-down, and [it] brought everything to a head. But the brand had been declining for decades. It brought it into sharper focus; all the issues we had. 
"It feels very similar to that here, where we had a really big shift in the company, announcing our plans to close our plants, which brought a lot of focus on the company. But the problems with the brand [in Australia] had been happening for decades. 
"We were in the wrong segments as customers shifted to smaller vehicles; we were in the SUV market, but customers had just gone in different directions – and continue to go in different directions. That's really what you saw here. 
"And then there were quality issues and things like that. 
"The big difference I see here is that we have the product line-up to really make a difference. When we were turning around the company in North America, our products were still three or four years out. We were talking about the future without a lot of product. 
"I think we've got an advantage here. 
"But again, we've got to fix the brand and how people perceive us..."
It doesn't end there, however. There are other "parallels" between Ford Australia and Ford in North America. For instance, there's a growing split in Ford Australia's customer base, says Sherwood. 
"We have a very established customer base that is largely [centred] around established Australian families, but there is a dynamic element of new blood in Australia. What we see is [with] our customer base, we've got to really focus on retaining those customers. 
"But we've got to find ways to attract this newer, first-generation Australian [customer] who don't have a connection with the brand here, like our established [customers]. We've got to do those almost in parallel. 
"When I say 'fix the brand', retaining those customers is a real priority... they're the folks who, quite frankly, have been frustrated by us.
"A lot of what you've been hearing about us recently – working with our dealerships to transform how the dealership experience is – is all centred around that, fixing our relationship with our customers."
It's the 'new blood' in the US that has taken Ford from an also-ran in the mid-size market segment to a true competitor, following the arrival of the new Fusion. That car is basically the Mondeo with different badges. In America it has taken market share away from traditionally strong Japanese competitors in California. Sherwood says that the cleaner, more dynamic styling was a helping hand in that, as was fuel efficiency. He anticipates the Mondeo could achieve a similar result in Australia. 
For Ford Australia, its 'brand fix' calls for a multi-faceted approach to keeping customers informed. The company has a message to sell concerning its changing product range in the short term, but it's important to make sure the public is even aware there will be a product range beyond 2016. Many believe the plant closures in Broadmeadows and Geelong will mean an end to sales of Fords in Australia, which is a problem Holden has encountered too. First and foremost then, the larger challenge in managing the brand's local image, according to Sherwood, is: "just communicating that we're here and committed to the country."
"This wave of products we have coming soon is going to help us communicate not only... the attributes of the vehicles, which are holding up very well globally... but it also just says we're here."
On the product front, Sherwood believes the new Mondeo will help raise the brand's profile in Australia, and Ford also plans to promote heavily its EcoBoost-led fuel efficiency. He didn't entirely rule out hybrids and plug-ins (there's a plug-in Mondeo sold overseas), but until the local market comes to accept the fuel-saving technology – and the costs come down – that sort of technology is not likely to be sold through Ford dealerships in Australia. Hero vehicles as a medium for brand promotion must be balanced against sales and profitability. That is fundamentally where Ford Australia is at, currently. It says much about Ford's hopes for Mustang too, incidentally. There is a hero car the company strongly expects to raise brand awareness AND sell in profitable numbers. 
Otherwise, Sherwood doesn't subscribe to the 'Field of Dreams' philosophy. Ford won't be building 'it' in the hope 'they' will come. That applies particularly to hybrids in Australia, but is also true of any niche model that small numbers of Australians would like to see here. F-150 falls prey to that thinking, as do Transit Connect and S-Max, to provide just three examples. 
"Here, you'd probably see more demand than in the other right hand drive markets, but you've got to have those other markets to make a right hand drive business case," Sherwood said of the F-150.
"You can't... and that's why the converters do well here, and that's the business model for Ford, just because there's just not enough outside of Australia.  But trucks, you know, well, the Ranger we're absolutely committed to, and so that, that will be our entry here."
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Written byKen Gratton
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