Hau Thai-Tang, executive vice president, Product Development and Purchasing, shared a sneak peek at future products and answered a variety of questions from retired Ford engineering executives at a meeting held recently at the Dearborn Country Club.
Thai-Tang opened the meeting by thanking the retirees for their years of service and contributions to Ford.
“We wouldn’t be here without you,” he said. “You paved the path for all of us.”
One of the subjects retirees brought up in the question-and-answer session was Ford’s recent announcement that it would shift vehicle production away from traditional sedans and focus more on different silhouettes, SUVs and trucks. Thai-Tang explained that the company could no longer make a compelling business case for small cars.
“The business environment is getting tougher and tougher. One of the things we’re seeing is that the capital demands for us to invest in some of these emerging opportunities – be it connectivity, autonomy or electrification – are quite intensive,” he said. “It’s forcing us to go back and look at all the products in our portfolio and understand whether they’re making money or returning the cost of capital.”
Thai-Tang said changing customer demand played an important role in the company’s decision to scale back on small cars.
“We’re finding that customers are moving in large numbers away from the traditional three-box sedans and into utilities. And this is a secular shift. We don’t think that these customers are going to come back,” he said. “So we’re taking the investment and engineering money that we’ve saved by making these decisions and investing it into low-price-point products in different silhouettes that are going to allow us to compete and make money.”
One retiree asked Thai-Tang what it’s like to run both the Product Development and Purchasing organizations.
“The opportunity I see is how do we work together in a much more collaborative way up front trying to understand the customer requirements and then working with the suppliers to think through things like capital reuse and using that to drive the most efficient design,” said Thai-Tang. “That’s the opportunity and that’s what we’re trying to do.”
Another retiree wanted to know what Ford is doing to attract and retain the best talent.
“Certainly the rejuvenation of Detroit is going to help but for me the most important thing is meaningful work,” said Thai-Tang. “We have a chance to work on really important societal problems, such as climate change, sustainable mobility, affordable mobility as a basic human right or the ability to get to a future where we have zero fatalities because the cars are smarter. Those are the things that I believe appeal to people.”
The Ford Retired Engineering Executives (FREE) is a group of Ford alumni who meet monthly to have lunch and catch up on what’s going on in the automotive business. If you are interested in learning more about FREE or know a retired Ford executive who might like to join, please visit www.fordretireeclub.org for more information.