Somewhere in Ford's Dearborn, Michigan headquarters, there has to be an extensive library of turnaround and rescue plans. It seems as if a decade cannot pass without Ford engineering some form of Lazarus-like recovery.
If life at Ford is a rollercoaster, then Lisburn woman Lisa Brankin has a front-seat view. As head of the brand's UK and Irish operations, she is helping steer the auto giant through yet another existential transformation.
At an investor presentation in May, pitching this latest turnaround plan, the company's president and chief executive Jim Farley admitted: "Before we talk about growth, we first had to earn your confidence back. In recent years, our financial performance hasn't been at an acceptable level."
But things are changing, he promised. The Detroit automaker reported net income of $3.3 billion (€2.8 billion) in the first quarter, its best since 2011.
“We’re running a much tighter ship. And we’re taking the tough decisions to restructure and design our business,” he said.
For Ford in Ireland, that meant more than halving staff numbers at its home in Cork and leaning more heavily on Ford in the UK for support and back-office help. And that means more responsibility falls on Brankin's shoulders.
Having taken up a graduate position at the company in 1990 straight from her studies at University of Ulster in Jordanstown, Brankin has been director of Ford UK’s dealer operations, head of passenger vehicles and director of marketing. In her latest role, she oversees Ford’s largest European market.
The immediate objectives of the latest transformation plan aim to stem sliding sales – particularly in the US – and rebuild finances. But analysts are clear that they are also looking for signs that Ford’s management team is preparing the company for the automotive revolution that’s under way.
We’re witnessing the greatest upheaval in the auto world since Bertha Benz took her husband’s new horseless carriage for a drive. The revolution is three-pronged: what powers the vehicles, who or what drives them, and how they are owned or used.
Widespread adoption
In the next decade, we will see the widespread adoption of electric power, autonomous driving controls and new ownership models. As a bastion of the auto establishment, Ford is expected to play its part, even if right now it seems to be off the pace.
Ford is lying in fifth place in terms of new car sales in Ireland, a poor performance for a brand that used to consistently top the sales charts. Part of this is down to a model portfolio that didn't keep pace with changing consumer tastes. In the face of a move towards crossovers and SUVs, Ford in Europe clung tight to its traditional formats, such as the Focus hatchback and Mondeo saloon, along with a range of admirable but dull people-carriers.
Now Farley has set out a new course for Ford, one replete with crossovers, SUVs and electric cars, such as the new Mustang Mach-E, which arrives here later this year.
Turning the fortunes of Ford around will be no mean feat. Many have tried before, with limited success. Asked when we will start to see the fruits of these labours, Brankin says: “I think the tanker has begun to turn around.
“One of the tenets of the global plan is to make automotive operations sustainably profitable. And that’s the focus of what we’ve been doing. And it has been about managing cost and the changes that you saw with the management teams in Ireland, and what we did in Ireland was all part of that. So that’s been done. I’m not saying there’s not more to come, but a lot of that’s happened. And we’re seeing the fruits of that at the minute and our results now.”
Farley’s change plan is about much more than revamping the showroom metal. Ford has its sights set on being a “tech giant”. He describes the new Ford as “a software- and data-driven company”.
“For Ford, it’s no longer just about the vehicle. Now, it’s the vehicle plus constant over-the-air updates, off-road navigation, uptime and productivity tools for commercial customers.”
That’s a monumental shift from the brand’s mainstream blue-collar roots into one that’s all about digital. The first step in this reinvention is the adoption of full electric power, heralded by the arrival of the new Mustang Mach-E crossover.
Inevitability
“From our perspective, we know that, by 2030, we’re going to be driving electric cars in the UK and Ireland because our governments have said that. So for us electrification isn’t a bet, it’s an inevitability that’s coming,” Brankin says.
“If you think about our first proper battery electric vehicle to come to Europe, the Mustang Mach-E, it’s called a Mustang because it’s got Mustang styling. We didn’t pick a worthy, dull, smaller family car.
“I think maybe in the past, we might not have been very brave. But I think going forward, you’ll see that we are. I think, even if you don’t like Ford or don’t like Ford products, when people see the Mach-E, they’ll be impressed. And I think it also goes a little bit against expectations.”
With the Mach-E priced at €51,590, Ford has consistently referenced Tesla customers as targets, a bold move considering the different consumer perceptions of both brands.
Brankin doesn’t accept that Ford has dragged its feet on rolling out new all-electric models. Her view is that the company is keeping pace with customer demand.
“I don’t think the infrastructure is there. I know that we’ve been accused of being too far behind the pace. If we’d had a battery electric vehicle [years ago], I don’t think it would really have sold.”
She outlines Ford’s electric car plans for Ireland and the UK. “By 2026, all of our passenger vehicles will have an electric option. By 2024, all of our commercial vehicles will have an electric option.”
However, she warns there are wider societal challenges ahead with the move to electric. The governmental targets for 2030 are different from the sort of rules and regulations that have gone before.
Penalties
With emissions and safety issues, it’s really just down to the car firms to make the changes or pay the penalties. With those sort of regulations, Brankin says, “the onus is really just on the manufacturers here to meet the standard and doesn’t require customers to change anything really”.
“But with electrification, it isn’t just about manufacturers, it’s about other things as well. I think the issue is less around will the manufacturers as a group deliver it – the question is, will there be places for customers to charge them? Can they afford them? What’s the impact, for commercial vehicles and the impact that has on the overall economy? This is not just a little ring-fenced manufacturer debate.”
She says manufacturers will be part of the solution, “but I don’t think we’ll be the solution”.
And while the Mustang Mach-E is in the public spotlight, it is on commercial vehicles that Ford is placing increasing focus. Understandably so, perhaps, for while it’s languishing in the new car market at present, it is the top-selling brand in the Irish van market, boasting a 25 per cent market share. VW ranks second with 12.7 per cent.
“For us, commercial vehicles are a really big business. Our aspiration is that [they] will be about 50:50 in terms of sales volume, so commercial vehicle growth in Ireland is very important for us,” says Brankin.
The 50:50 sales mix in the Irish market is perhaps within sight, but that’s partly down to the slide in its new car sales rather than a spike in its commercial vehicle sales. In 2016, Ford sold 14,666 new cars and 7,518 vans. Last year it sold 6,792 cars and 5,096 vans.
Ford’s transformation plan has been stymied by Covid, but also by the global computer chip shortage that is hitting deliveries. Ford expects to lose 10 per cent of its planned production for the second half of this year, which translates to 1.1 million vehicles, or an estimated $2.5 billion hit in full-year earnings. The chip shortage has already pushed out the arrival of the Mustang Mach-E in Ireland until September.
It has also drawn a spotlight on to the incredibly complex supply chain in the sector and the challenges it faces as it seeks to enter the tech world. These chip suppliers are not beholden to the car giants and have stronger ties to the big tech hardware players.
Whether the blue oval brand can really compete with the Silicon Valley giants and reap a greater share of its profits from software subscriptions rather than motoring metal remains to be seen. For customers to use the software, they still need to have invested in the hardware, and in the motoring world that still means selling vehicles.
For Ford, the revolution is only just beginning. There are sure to be more hair-raising dips on its corporate rollercoaster. Yet Brankin and other motor industry executives can take some solace from the knowledge that, despite facing thousands of rival start-ups and big-name brands over the last 118 years, only two US carmakers have never gone into bankruptcy: Ford and Tesla.
Name Lisa Brankin
Age 53
Position Managing director, Ford Britain and Ireland
Something you might expect: Cosmopolitan honoured her as a female trailblazer in 2018
Something that might surprise: A Ford "lifer", Brankin has held 16 different posts in the company before taking up this position. Jobs before joining Ford included a stint as a home service adviser for British Gas.
