Ford Motor Company EVP and President, The Americas, John Hinrichs speaking to Automotive News Publisher Jason Stein addressed several hot topics today like technology, disruption in the domestic marketplace, an influx of new talent, plus cash flow and profitability in the industry, an area in which Ford has outperformed the predictions.
Specifically to finance, Ford has generated $36 billion over the last four years, and that really started with the aluminum F-150 truck and the new Mustang. But it wasn't all smooth sailing.
"Just as we were launching the new F-150 and Mustang, the industry - not just Ford - got hit with a huge wave of recalls," notes Hinrichs. "The use of global platforms with global parts sourcing can escalate recalls quickly when problems arise. But we got through it and our U.S. operations rapidly recovered to regain the position as our largest and most profitable market."
Hinrichs also shared a keenness for the influx of new talent.
"I think that for the past few years, the auto industry has been hot with an influx of new talent from different disciplines, so I'm very optimistic on our industry's future. With emerging autonomous and advanced feature technologies, I'm optimistic about the best talent coming in, This industry offers a bright future with a lot of places to go professionally."
Part of the future is a model mix that's transforming before our eyes. The balance between trucks and SUVs versus passenger cars is now trending towards roughly 35 percent / 65 percent truck/SUV, which is a huge change over the past several years. But on the regulatory front, Hinrichs doesn't view that as a threat.
"We don't have to make as great a trade-off in fuel economy now when selling an SUV versus selling a passenger car. Yet, let's not forget that ten years ago, at the dawn of the financial downturn, the trend was dour on trucks and SUVs. But now, with SUV popularity clearly growing, we need to meet those demands and meet the regulations and we have."
Finally, Hinrichs spoke about the recent news that Tesla has a higher market capitalization than Ford.
"Cash flow should have a big influence on market capitalization," noted Hinrichs. "We at Ford have a pretty good flow these days. But many things matter to market cap: brand position plus growth potential in the short-term and in the long term are just a few. Assumptions about the regulatory future play a role, as well. So the market isn't totally rational, though I do have a lot of respect for what Tesla's done. Yet, we at Ford have some big plans, too."
John Hinrichs, EVP and President, The Americas, Ford Motor Company