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Ford Back-Tracks on Hybrid Promise

May Have Taken Wrong Turn in the "Way Forward"

By Joe Benton
ConsumerAffairs.com

June 29, 2006

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The boss at Ford is backing off some of his "Way Forward" program, including a promise to build 250,000 hybrids by the end of the decade. Chairman and CEO Bill Ford dismissed any talk of bankruptcy after Standards & Poors dropped Ford's rating deeper into "junk" territory.

On the subject of hybrids, Ford said he has "rethought" the promise that was the centerpiece of a TV ad campaign in 2005.

In an email to company employees, Ford said he didn't foresee the evolution of other fuel technologies and now thinks that the company needs to pursue a broader environmental strategy that focuses more on other alternative-fuel vehicles.

"Now, I am convinced that the objective we had set earlier to build capacity for 250,000 hybrids at the end of the decade is too narrow to achieve our larger goals of substantially improving fuel economy and CO2 performance."

Ford's new idea now includes a focus on other fuels like ethanol, clean diesel and bio-diesel, as well as advanced engine and powertrain technologies.

The company plans a partnership with VeraSun Energy to create about 50 new E85 fueling stations between Kansas City and Chicago which Ford is calling an "Ethanol Corridor."

Ford also plans a hybrid research-and-development center at its Volvo subsidiary in Sweden that will concentrate on producing hybrids for the European market.

This is not the first fuel economy decision to be "rethought" at the Ford. In 2000, the company promised to raise the fuel economy of its SUV fleet by 25 percent over five years. Ford abandoned that commitment three years later.

In the 1990s, Ford joined with GM and Chrysler to develop an 80-mpg "supercar" by 2000 as part of a deal with the Clinton administration. The program was abandoned when George W. Bush took office in 2001 and the new administration shifted the focus to hydrogen-powered fuel cells.

Ford blamed the company's latest financial setbacks on slower sales of sport-utility vehicles, which have declined because of the recent run-up in gasoline prices. That hurts Ford because trucks and SUVs make up more than half of its sales.

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