DETROIT -- More than a year into his tenure as CEO of Ford Motor Co., Mark Fields has a redesigned F-150 and two updated SUVs at his disposal just as demand for those types of vehicles is surging. Amid that fortuitous timing, Fields is also trying to position Ford for a time when gasoline is more expensive again and fewer consumers want to own cars at all.
This month, he announced a $4.5 billion investment to develop more electrified vehicles over the next five years, even though sales of plug-ins and hybrids are slow at the moment. He also said Ford is radically changing its product-development process in the hopes of making vehicles that better fit people's changing needs. And through the Smart Mobility initiative he started, Fields is pushing the automaker to explore new ideas such as e-bikes that help drivers get through congested streets and an Uber-like shuttle service for employees that eventually could help Ford move beyond selling cars by getting into the ride-hailing business.
Fields, 54, was interviewed at Ford headquarters in Dearborn, Mich., by Staff Reporter Nick Bunkley, News Editor Dave Guilford and Dave Versical, director of editorial operations.
Q: What's your expectation for industry sales in the next few years, as gasoline prices and interest rates rise?
A: I think the next couple of years for the industry could stay at a very healthy level. Do I think it's going to grow another 10, 15, 20 percent? Probably not, just because of capacity. But the state of the labor market is very healthy -- wages and incomes are growing.
I keep reminding folks that the Fed, if and when they raise rates, it's a sign of a healthy economy. The Fed raised rates on Dec. 18. With housing starts and new home sales that are still below pre-recession levels, I think that bodes well for the industry.
To what extent is your plan to invest $4.5 billion in electrified vehicles driven by regulations rather than consumer demand?
It's a big piece of it. In this business you have to project where you see consumer demand going forward. We have to project out four or five years. How you view things depends upon where you stand. Right now, where we stand, gas is very inexpensive. Think about 4 or 5 years ago, where gas was. It was a little bit different. We have to project out, and our view ongoing is still that the price of a barrel of oil is going to go up over time. So it's really important for us to anticipate that.
Secondly, we have the [corporate average fuel economy] regulations that are out there -- the one national standard -- and we have to meet that. And that's why the midterm review becomes so important for us, because we want to make the investments.
But at the same time there has to be a market there for it. And that midterm review was all about agreeing with the government on looking at the consumer acceptance of the technology, looking at the costs -- to the companies, to the consumers, what impact it may have on jobs and things of that nature. So we're looking forward to that discussion.
What's your plan going into the midterm CAFE review?
Overall, we want it to be very fact-based. We'll have to look at what has been the acceptance of the technology. It's more than a bit challenging. There's probably 50 or 60 electrified vehicles in the marketplace. Year to date, it's a little over 2.5 percent of the total industry. Four years ago, there were maybe 10 or 12 models, and it was about 2.5 percent of the industry.
We want it just very fact-based -- lay it out. We want to be part of the solution. But we want to make sure it works for consumers and it works for us as a company.
With transaction prices and profits up, are you able to try to regain some market share?
Our main priority is to run a disciplined, profitable business. Going out and chasing market share is not part of our plan.