26
Jun
07

Ford’s Focus Takes a High-Tech Tack for Comeback: Doron Levin

June 25 (Bloomberg) — Ford Motor Co. thinks it finally has a chance to crack the small-car market, and not a moment too soon.

This fall Ford will begin selling the second generation of the Focus, a compact that hasn’t fared well against some of the stiffest competition in the auto world. The new model, available with an optional interactive speech-recognition system developed with Microsoft Corp. and called Sync, will have to offer young shoppers a clear advantage over a Honda or Toyota, aside from a discounted price.

“Small cars historically were bought because they were economical,” said Rebecca Lindland, auto analyst for Global Insight Inc. of Lexington, Massachusetts. “The latest compacts and subcompacts tend to have sexy features like Bluetooth,” a wireless technology that gives hands-free control of cell phones, e-mail and other electronic devices. “Cars have to be iPod-friendly and cell-phone-friendly” in order to appeal to young buyers, she said.

Since much of the competition is headed in the same direction, Focus’s speech-recognition system will have to be as good if not better. If it doesn’t work well, Focus loses a potential advantage. But if Sync clicks, the feature could be a reason to consider Ford, a brand that has little or no cachet with the young.

Full Makeover

Focus also boasts a new body style, interior and improved four-cylinder engine. Fuel economy is projected at 37 miles a gallon on the highway, and in the high 20s in the city, about 10 percent higher than the version it replaces. The retail price of Focus starts at about $13,700.

But style, performance and fuel economy may not be enough to distinguish the new one. Thus Sync, which operates from a computer embedded in the dashboard. Ford hasn’t yet announced its price.

Jim Cain, a Ford spokesman, said “the speech-recognition feature is the killer app. You can, for example, speak to your iPod and order music or individual songs or artists in an easy conversational tone. The software is something else, it can understand Lucy and Ricky,” referring to the characters in the old TV comedy with Lucille Ball and Desi Arnaz, who spoke English with a heavy Cuban accent.

I hope Cain is right. Ford plans to offer the feature in every Ford, Lincoln and Mercury vehicle over the next two years.

Say What?

My impression of speech-recognition software products for cars is mixed at best. Some programs hardly work, while most others are no better than mediocre. I have yet to encounter one that’s truly dependable, consistent and easy to use.

The debut of Ford’s original Focus was almost a non-event in 1999. Back then, the automaker was riding high on profits from Explorer sport-utility vehicles and F-Series pickup trucks.

Focus seemed like an afterthought, doomed to also-ran status in competition with the Toyota Corolla, Honda Civic and other small cars, most of them foreign makes, with better reputations. This was familiar territory for Ford, which had for two decades produced cars such as the Pinto, Fiesta and Escort, which had been outclassed consistently in terms of quality, style and image.

Ford now is paying the price for investing too heavily in lumbering truck-like models while paying too little attention to cars. General Motors Corp. and DaimlerChrysler AG’s Chrysler Group likewise have suffered by giving cars short shrift.

Lagging Behind

Though Ford pitched the Focus as a model with an international vibe, sales were just so-so, and ratings from the likes of Consumer Reports couldn’t match those for the Civic or Corolla. (In Europe, a more expensive and fancier Focus sells well.)

Eight years later the stakes have risen in the U.S., where buyers are migrating to lighter, smaller vehicles with better fuel efficiency.

Worse for Ford, it is saddled with plummeting sales and ballooning deficits and is running out of time to prove to consumers that it should be taken seriously as an automaker.

Ford also is hoping that buyers won’t recall, or won’t be aware of, the quality deficiencies that plagued the early days of the Focus. Even if they do, dealers can mention the June 6 announcement by J.D. Power & Associates, a quality-rating company, that said Ford brands scored four the of the top 10 places in new-vehicle quality.

Lingering perceptions of Ford as a second-rate brand may require extraordinary genius to overcome. That’s why the automaker put the Focus advertising account up for bid. Ford’s longtime advertising agency, WPP Group Plc’s J. Walter Thompson, the incumbent, is among the agencies invited to bid for the business.

If Focus’s hip electronics create some buzz, all the better. Apple Inc. was floundering six years ago before introducing the iPod, and it made all the difference in the world.

(Doron Levin is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: Doron Levin in Southfield, Michigan, at dlevin5@bloomberg.net .

Last Updated: June 25, 2007 00:29 EDT

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