New Ford targets fuel efficiency

By Jorn Madslien Business reporter, BBC News, London motor show

The covers were whipped off the new-shape Ford Fiesta at the motor show in London to the tunes of Alesha Dixon.

The new-look Fiesta was first unveiled at the Geneva motor show in March, but there is a crucial difference: this particular derivative is an Econetic version, kitted out with a 1.4 litre diesel engine that emits just 98 grams of carbon dioxide per kilometre (98g/km).

This makes it one of - if not the - least polluting four-cylinder cars on the market

These days, as indicated by a price war brewing on the supermarkets' petrol forecourts, consumers are more interested in how much a car drinks, and this one claims to deliver more than 76 miles per gallon (mpg).

"For the average customer, it's fuel economy that is the driver," Mark Ovenden, Ford of Britain's marketing director, tells the BBC News website.

"But by getting better fuel economy, you deliver better CO2."

Future of diesel

Ford has a legacy to overcome Jay Nagley, industry analyst, Spyder Automotive

Over at Ford's diesel engine factory in Dagenham, they are responding to this desire for engines that deliver improved fuel efficiency.

Five days a week, three shifts man the engine assembly lines, each employee manning one work station.

This year, some 485,000 1.4 litre and 1.6 litre engines will leave this factory, increasing to 575,000 next year.

"In the short term, diesel is clearly the way to go," Tim Winstanley, diesel powertrain development manager, says during a recent tour of the factory.

"The hybrid is very efficient, but it's an expensive technology compared with Econetic."

Legacy

It is a theme Ford's executives are eager to elaborate on.

It is all about "making available for the many what's been available for the few", according to Mr Ovenden, who points out that petrol electric hybrids pioneered by Honda and Toyota remain expensive when compared with conventional petrol or diesel engines.

The idea that large meant luxury, small meant cheap, is gone Mark Ovenden, marketing director, Ford of Britain

The portrayal of diesel engines as a viable alternative to hybrids - both in terms of CO2 emissions and fuel economy - is not new.

German carmakers BMW, Mercedes and Volkswagen have long hailed diesel as an answer.

As a consequence, diesel sales have soared in recent years - though Ford has never been seen as a leader in this market.

"Ford has a legacy to overcome," says Jay Nagley, industry analyst with Spyder Automotive.

He continues that in the past Ford's blue oval badge was widely seen as a company ending up with the "lowest common denominator in terms of engineering".

Good products

But much has changed at Ford in recent years, especially in Europe where its entire model line-up from Fiesta to Escort to Mondeo and beyond has been updated in recent years in terms of design and engineering.

Its model offering "is going to be the lowest age of any carmaker in Europe", according to Mr Nagley.

"In Europe, Ford now has good products," he adds, pointing out that in the UK Ford is still the market leader with a market share of more than 16%. It has been ahead of its rivals in terms of market share for 30 years.

Ford is looking to have one of the youngest model ranges on offer

The success on this side of the Atlantic has produced results.

Ford of Europe is profitable and has been for years, in sharp contrast to the US operation where sales fell 28% last year compared with a year earlier.

Weakness in the US hammered Ford Motor's finances last year, when it reported a $2.7bn loss.

During that year and this it has sold its Aston Martin, Jaguar and Land Rover brands to salvage itself from bankruptcy, and the group is not expecting to be making a profit until next year at the earliest.

Europe to the rescue

Clearly, the US operations still need help, and according to Mr Nagley, the plan seems to be that Ford of Europe "comes to the rescue".

As demand for large gas guzzlers in the US is falling, Ford wants to jazz up its Fiesta and Focus models for the US market, essentially by making them more luxurious, again reflecting another trend that can be seen in Europe.

"The idea that large meant luxury, small meant cheap, is gone," says Mr Ovenden.

Mr Nagley, applauds the strategy, though he admits it does not come without risks.

Ford has tried the "World Car" idea in the past, selling the same cars in all markets, with disastrous consequences. This time a more sophisticated approach is needed.

"It's about having the sophistication to have common components but different cars for individual markets," says Mr Nagley.

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