Example of Promises with no results….

20 Aug
R.I.P. PAG, Aug 16, 2007 11:50 AM


Nothing lasts forever. Especially in the auto industry.

Consider tailfins and bumper bullets, Toyota’s squeaky-clean quality reputation and “Ask Dr. Z.” (Chrysler couldn’t get rid of that ill-fated campaign fast enough, formally abandoning its claim to the trademarked slogan just eight days after Cerberus announced it would acquire the auto maker.)

But nowhere is churn more constant, it seems, than at Ford.

Remember 2002’s turnaround-to-end-all-turnarounds? Accompanied by a soothing soundtrack of executive pleadings for patience, “The Revitalization Plan” was tweaked twice within 18 months.

Then came last year’s milestone cost-cutting initiative, code-named “The Way Forward.” It was revised nine months later.

Changes such as these are excusable, even expected, because of market fluctuations. But when a truly inspired concept must be sacrificed for the greater good, the anguish reverberates like ripples on a pond.

In 1999, Ford assembled an armada of four mainstream luxury marques and one ultra-luxury high-performance brand, each boasting unique appeal and a time-honored heritage. It looked like the auto maker had charted a course for greatness.

Today, sadly, the plan is being scuttled.

With legendary “car guy” Wolfgang Reitzle at the helm, Jaguar, Land Rover, Volvo, Lincoln and Aston Martin set sail as the Premier Automotive Group – Ford’s resounding retort to the booming fortunes of BMW and Toyota’s Lexus division.

“A fleet that is united, instead of a battleship,” Reitzle said at the time.

From a newly built port in California, PAG was expected to account for one-third of Ford’s overall profits.

And not just any shanty would do for a sales point. Ford’s vision called for single sites with separate showrooms, each reflecting the character of the brand it housed.

I remember the smug look on the face of Jac Nasser, the aggressive Ford CEO who engineered the strategy. Brimming with confidence in early 2001, he boldly declared he wouldn’t trade Ford’s brand collection for any other roster on the planet.

Why would he? Nasser was to the global auto market what Horatio Nelson was to the seven seas – commander of the most formidable fleet in the world.

But a few months later, the ship sprung a leak. Or more accurately, a blowout.

The Firestone tire debacle took the wind out of Ford’s sails. Profits plunged, and Nasser was made to walk the plank. Reitzle went over the side a few months later.

Another crack in the hull developed when Lincoln was returned to safe harbor in Dearborn. And PAG, anchored by Jaguar in more ways than one, began to drift away from its target.

Expectations had been for Ford to increase its global luxury-vehicle volumes from the 1997 level of 200,000 units to 1.4 million units by 2005. By last year, deliveries were still well below 900,000.

Now, Ford apparently is leaving PAG for salvage. Having unloaded Aston in March, the auto maker has acknowledged it could jettison Jaguar and Land Rover.

And it does not deny that Volvo could also be on the block.

No matter how innovative, nothing lasts forever. Ask Dr. Z.

So who would you give a VOLVO to…. No one!

1 Comment

Posted by on August 20, 2007 in Articles


One response to “Example of Promises with no results….

  1. Silhoute

    August 21, 2007 at 7:35 am

    Even the bigger players falter. What can you expect of our Proton? Especially we have the current management in place. The salae of MV Augusta to Gevi SPA at a nominal 1 Euro and recently the sale of husqurvana by Gevi Spa to BMW confirmed my earlier suspicion that Proton is being stripped of its asset.
    Production cost and quality is the key point to be stressed to be competitive especially in the mass market products. Ford was going for the luxury niche market which is a different ball game altogether.


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