Ford's Flexibility Is the Story to Watch

2011 Ford Fiesta
2011 Ford Fiesta

It's become fashionable for fans of the Ford turnaround to talk about the company having success due to a slew of better designed models like the Fusion and Fiesta. Or to say the company is way ahead of the pack embracing must have in car technology like Sync. There's no doubt those reasons, along with many others are big factors in Ford getting back in the black.

But, at the end of the day, Ford is thriving because it's becoming a more nimble, flexible auto maker.

Nowhere is that more evident than in Ford's announcement Tuesday that its plant outside Detroit will be the first in the world to build standard internal combustion, hybrid, plug-in hybrid, and electric vehicles in one plant.

Why is this news? For starters, this is the first plant in the world where all models with different power train systems are being built under the same roof at the same time. More importantly, it shows the next level of flexibility in building cars and trucks. Somewhere engineers are smiling, while the rest of us are saying "Is this really that important?"

Yes, it is. Here's why?

Remember the video and pictures in the last twenty years of auto plants shutting down because sales of particular car or SUV went belly up? In the past Ford had little choice but to close those plants because they were locked into building one model and re-tolling the lines for a different model would cost too much. Those scenes should be less common in the future with Ford making its plants more flexible.

This will be critical in the future as people demand a choice between gas powered, hybrid and electric versions of a particular model. If gas prices plunge, and demand for electric versions of a certain Ford model drops quickly, Ford will be able to lower that production while increasing the number of standard models it builds. If the situation changes six months later and high prices at the pump means more people want electric models, Ford will be able to switch again.

At the end of the day, Ford CEO Alan Mulally is an engineer making Ford a much more efficient and profitable car maker. And making his plants more flexible is at the heart of that plan.

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