Car, truck business catches up to auto show imagery – Chicago Tribune

Posted: Saturday, February 08, 2014

If you’re looking for a Bugatti Veyron 16.4, capable of doing zero to 62 mph in 2.46 seconds and topping out at 253 mph, you can find it at the 2014 Chicago Auto Show. Fast as it is, unless it can outrun creditors, this is as close as most of us will get to one. The manufacturer’s suggested retail price is $1.48 million and, well, just no.

Walk away from the Bugatti and around the nearby Rolls-Royce, and you’ll head right into General Motors’ Chevrolet, GMC Trucks and Buick displays. Like every other carmaker at the auto show, each offers its own brand of daydream fodder, some more realistic than others. Maybe you just fantasize about getting better mileage.

The auto industry’s annual celebration of itself, occupying McCormick Place through Feb. 17, is where we see how the industry wants itself and its cars and trucks to be seen. Even the most prosaic, utilitarian vehicles gleam under the lights. Other models project power, speed, toughness and whatever else might sell, despite the incongruity of being parked in what amounts to a carpeted warehouse setting.

Five years ago, when shares of, say, Ford Motor Co. were trading at around 10 percent of today’s price, exhibits may have been a tad smaller. But, even then, despite the flagging economy and auto industry woes, there was a concerted effort to sustain the kind of hopeful vibe more appropriate to a rebound.

“At the show, there’s a lot of focus on product,” Joseph R. Hinrichs, a Ford executive vice president and the company’s president of the Americas, said during a visit to Tribune Tower before heading over to McCormick Place the other day. “It’s a busy year for us, an exciting time, watching the U.S. economy hopefully grow and move forward, which helps underlying demand for our industry.”

A yellow 2015 Mustang, the newest iteration of the Ford classic, sits alongside what, it is agreed, was the first Mustang ever purchased. An adman couldn’t invent a better back story than that of Gail Wise, the Park Ridge woman who still owns the baby blue convertible she bought almost 50 years ago.

Newly graduated and about to start teaching elementary school, Wise, then 22, had the good fortune to be dealing with a salesman at the old Johnson Ford on Cicero Avenue willing not only to show her the sporty little car under wraps in the backroom, but to sell it for around $3,400, on April 15, 1964, two days before Lee Iacocca officially introduced it to the public at the New York World’s Fair.

Half a century later, the lines of Wise’s beautifully restored Mustang still trigger some magnetic primal response. Its features are more delicate than that of the 2015 version, which almost seems cloaked in armor. But both look as though they could have been plucked from some giant toy box.

The Mustang is one of 16 new models Ford is putting out this year, an effort to refresh its lineup coming off a year in which it racked up an $8.6 billion profit, $8.1 billion of it in North America. That’s a stark contrast to just a few years ago, as it managed to survive the downturn without the bailouts Detroit rivals GM and Chrysler required, when it was closing 16 plants.

“During the worst of times, 2008, 2009, when we were going through massive restructuring … we really doubled down our investment in new product,” Hinrichs said. “That has helped pave the way for market-share gains and strong pricing on our products as we brought out that new product. We’ve continued to heavily invest in that new product. … In this business, there is a correlation between freshness of product lineup and market share.”

Not far from the Mustang is Ford’s new version of its best-selling truck, the F-150, which will be made of aluminum instead of steel in a bid to shave 700 pounds and improve fuel efficiency.

It’s no small wager on the appeal of better mileage, but it also should help Ford push closer to benchmarks the U.S. government has set for improving the environmental impact of all vehicles on the road in the coming years. Those federal standards have been made harder to achieve by sluggish sales of electric and hybrid models, held back by costs and insufficient advances in battery technology.

“What’s happening is consumers are very economical, they’re logical,” Hinrichs said. “There’s a small percentage of the population that wants to make a statement or (primarily) wants to do something for the environment. Most people care about the environment, no question, but they’re making an economic decision.

“Fuel economy’s still a big deal” in driving sales, he said. “Technology is becoming an even bigger deal — infotainment systems, voice commands, Bluetooth connectivity, the whole social connectivity of the cellphone, the vehicle, the navigation system — that whole environment is growing. Styling still matters a lot. There’s still the beauty of a new vehicle and the expression that you give by what vehicle you drive.”

Some within Ford were thinking an economic downturn would have people ditching their mobile phones, tablets and other gadgets to save money, according to Sheryl Connelly, Ford’s resident futurist and responsible for keeping tabs on global consumer trends. Obviously, just the opposite played out and the result is that technology has taken on a fast-increasing prominence in vehicles.

“There will be a day when you’re driving into Chicago and you need to find a parking spot and the system will tell you you have this spot reserved (near) Michigan Avenue, and that’s your spot and the navigation will take you right there,” Hinrichs said. “It’s been studied. About 30 percent of the gas wasted in cities is because of trying to find a parking spot.”

The big Detroit automakers are all making money these days, but some worry a setback in the recovery could hurt them despite pent-up demand. Hinrichs notes that the recent profits at rival Toyota are helped in no small part by Japanese currency moves, and speaks of the difficulties of competing with that. He points to the growth potential Ford is finding in China, but that hasn’t yet offset concerns in South America and problems in Europe.

With Ford employing nearly 5,000 people in Illinois — including more than 3,000 working on the Ford Explorer, Ford Taurus and Lincoln MKE at its Chicago plant on Torrence Avenue — and spending more than $1 billion on parts each year from locally based suppliers, its successes and failures are of more than passing concern.

“I don’t think we’ve seen the peak for Ford, and we expect the industry to grow in 2014 over 2013,” Hinrichs said. “We have said that our margins will show some decline in 2014 over ’13, primarily because of the cost of all the launches and most specifically the cost of converting our manufacturing system from steel to aluminum on the F-150 truck. … (But) that’s a one-time deal. Our business is very strong.”

That’s not something we’re meant to dwell upon while tapping into our inner Andrettis at the auto show, but it’s something with which we can all drive away.

Twitter @phil_rosenthal


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