Jim Baumbick Discusses Product Derivatives With Ford Retired Engineering Executives

Ford’s Jim Baumbick, Vice President, product development operations and quality, recently spoke to members of the Ford Retired Engineering Executives (FREE) group gathered in person and online. Discussing the future with an audience intimately familiar with Ford’s history, he detailed the company’s strategy for creating derivatives – generating more value out of existing products by giving customers more of what they love about products like Bronco, Mustang and others.  

Baumbick, who was making his fourth appearance before the group, leads development of all Ford Blue ICE products, as well as the company’s cycle planning, vehicle development engineering and product development operations.

Ford’s ability to build a winning portfolio that includes both gas-powered and electric vehicles was enabled in part by the company’s decision in 2018 to stop producing sedans, Baumbick said. That change allowed Ford to invest in and compete with products where the company was strong, such as SUVs and trucks. Today, Ford has among the freshest ICE lineups in the industry, and has been able to move quickly to electrify iconic nameplates such as the Ford Mustang and F-150, which gives the company an advantage as it transitions into the next generation of EVs.

Derivatives are lower-cost investments that create unique spin-offs for different customers from their parent vehicle. They share a vast majority of common parts with their namesake, such as the Bronco Raptor, Mustang Dark Horse and Mustang Mach-E Rally, and they deliver higher conquest rates than their predecessors, according to Baumbick. Derivatives also require minimal additional complexity, which is more than offset by strong margins.

“It takes the best of what makes a Bronco a Bronco or what makes a Mustang a Mustang and amps it up in different territories,” Baumbick said.

Bronco Sport, a variation of the Bronco, is already showing signs of claiming market share held by Jeep, Baumbick noted, and its modularity allows customers to easily remove panels and creates an opening for the company to create parts and accessories for them to customize their SUV.

“We’re neck and neck with (Jeep) and this is just early in its life cycle,” he said. “Our strategy from Day 1 with this architecture was to develop quick, fast and inexpensive derivatives. I want to keep Jeep on their heels.”

Like Bronco Sport, the Ford Maverick is another shining example of the “playing-to-win” strategy Ford committed to in 2018. The small pickup combines the best attributes of a sedan, such as fuel economy and interior space, with the utility of a pickup. Nearly 60% of Maverick buyers are new to Ford, Baumbick said, and its sales are conquesting buyers from Toyota RAV4, Honda CR-V and the Honda Civic.

“Those were people who were not buying a Ford Focus,” he said, referencing Ford’s decision to exit the sedan segment. “It’s the truck they didn’t know they needed.”

Baumbick also said the new Mustang Dark Horse is resonating with “a completely different set of customers” who are lining up to buy it and making it their own.

An expanded use of hybrids will also be part of Ford’s strategy going forward, Baumbick said, noting the company is already the world’s No. 2 seller of the alternative powertrains. Hybrids are the right solution for customers who drive long distances on a regular basis, some of which include towing, until EV infrastructure improves. EVs are suitable, though, for most customers’ daily commutes, he added.

Baumbick said he’s proud of the winning portfolio Ford has created, adding that the company is investing in such a way that ensures its continued success for years to come, as well as the success of the next generation of EVs.

“This is the right product plan,” he said. “When you watch our competitors, they were saying they were all-in on EVs and now you’re starting to see some reinvestments in ICE. We’ve always said it’s a combination of both – they’re a 1-2 punch. There’s not another OEM that wouldn’t want to have our lineup of ICE products.”

In addition to having the right product mix, Baumbick said Ford’s reorganization into three separate business units (Ford Pro, Ford Blue and Model e) has created a deeper focus on customers’ needs within each area.

Baumbick also conducted a lengthy Q&A with the group on topics including quality, electrification and software-enabled services like BlueCruise. Chief Advanced Product Development and Technology Officer Doug Field joins the group for its next meeting.