This little tidbit was in an interview in yesterday’s W$J (yes, I’m behind) with Ford CEO Alan Mulally. The interviewers asked him what had been the biggest surprise he’d encountered since coming over to Ford from Boeing last September. Mulally responded:
The biggest learning was the fact of how all our customers are aware of the brand but over the years, on the car side, their consideration of us is much less than the competition. We hadn’t been concentrating on the smaller cars like we had on the big SUVs and trucks. Now the question is, how do you get the consideration on cars to get [customers] back in the showroom?
The biggest aha was on CAFE [federal Corporate Average Fuel Economy regulations] and what a market-distorting policy that is, what a failed policy that has been in reducing our dependence on foreign oil.
I learned about it from the team. You have these charts with the critical issues and boom on three or four of them is a question about “where are we going to go with CAFE?” So all of a sudden one of the biggest issues on everyone’s mind is CAFE in these 2- to 2½-hour meetings. The first time I heard about it was about two weeks into the job. It’s on everyone’s mind.
The CAFE standards, because they exempted pickup trucks and SUVs from the mileage requirements applied to cars, have been a huge factor in motivating Detroit to focus all its energies on the big and the wasteful and to neglect cars. It’s nice to see that Mulally and others at Ford seem to realize that. But I am very curious as to Mulally’s prescriptions for fixing it. The carmakers are opposing the energy bill passed by the Senate that would require a 35 mpg average for their fleets, cars and trucks combined, by 2020. They’re supporting a House bill that would make it 35 for cars, 32 for trucks, by 2022. Is that all he thinks needs to happen to cure CAFE’s “market-distorting” effects, or is there more? Does he think an increase in gas taxes is in order?
What’s that you say? I’m a journalist, so I should ask him? Okay, I’ll get to work on it.