Ford launches ads, deals

Automaker will showcase its recent awards, offer new incentives amid disappointing sales figures.

Bryce G. Hoffman / The Detroit News

A new Ford Motor Co. internal report card shows the automaker is still missing its retail sales and cost-cutting goals, but executives told employees Wednesday a new marketing campaign and expected concessions from suppliers should keep its North American turnaround plan on track.

The monthly progress report was reviewed during a Webcast on Wednesday and a report card posted online.

Still smarting from last month's disappointing sales numbers, Ford is today launching an advertising campaign designed to trumpet its recent quality gains and is offering new incentives to bolster sagging sales of its bread-and-butter pickups.

The new ads highlight Ford's success in the J.D. Power and Associates' annual survey of new car quality.

The Dearborn-based automaker surprised the industry last week by blowing past rival Toyota Motor Corp. to claim the most top quality awards in this year's initial quality survey.

Some ads will tout Ford's corporatewide quality gains. One that will debut today features the tagline "Put the pedal to our medals" over a photo of the five trophies Ford received from J.D. Power.

Others will focus on the success of individual brands like Lincoln, which was the highest rated domestic luxury brand in the survey.

"We're going to leverage this," said Cisco Codina, Ford's group vice president in charge of sales, marketing and service for North America, told employees during the Webcast.

He said Ford was surprised by the big incentives competitors offered during Memorial Day weekend. Ford was the only one of the Big Six automakers to see sales decline last month over May 2006.

"Our competitors put quite a bit of money in the marketplace," Codina said, adding that Ford is stepping up its own spending on advertising and incentives this month to make sure that does not happen again.

In addition to incentives announced earlier this month, Ford is now offering more cash back on its pickups. Customers who buy a 2008 F-Series Super Duty through July 2 can now get $1,500 in cash -- up from $1,000 -- on regular and super-cab models, as well as low-interest financing.

Ford is also offering $1,000 in bonus cash on four-door crew cab models. The automaker is also putting another $1,000 on the hood of all 2007 F-150 pickups. That can be combined with Ford's current zero-percent financing or $3,000 cash-back offer.

While Ford and other automakers have long sought to wean consumers off incentives and adopt a more rational pricing model, Art Spinella, president of CNW Marketing Research, said Ford has to at least match the competition.

"They have no choice. They've been consistently undercut by their competitors," Spinella said. "Even Toyota started throwing money at the Tundra -- and a $1 incentive from Toyota is worth $2 from anyone else."

While Ford's quality has improved, Spinella said consumer perception has not kept up. He said the automaker needs to keep hitting this point in its advertising, but also needs incentives to get customers into its showrooms to test-drive its new cars and trucks.

"It's as good a strategy as any, but it definitely isn't what anyone wants for the long run," Spinella said.

Ford unveiled its new marketing strategy during a dealer pep rally at Ford Field earlier this week. That event was closed to the media. Ford showed video clips during Wednesday's Webcast.

Ford CEO Alan Mulally delivered a pep talk to dealers, as did Codina. Dealers also had a chance to look at all of Ford's upcoming vehicles, including Lincoln's new flagship, the MKS sedan, which will go on sale next year.

"It's time to grow our business!" Codina said. "Our products are back, and back with a vengeance."

Ford Americas President Mark Fields told employees Wednesday that the company is on track to meet its goal of refreshing 70 percent of its vehicle lineup by the end of next year.

However, Fields acknowledged more work needs to be done to ensure the company meets its turnaround targets.

Ford lost $12.6 billion last year. It has a plan to cut $5 billion in annual operating costs by the end of 2008 and return to profitability no later than 2009.

But this month's report card shows that Ford once again fell short of its material cost-reduction goals.

Raj Nair, director of commodity business planning, told employees that Ford can still meet its full-year cost-cutting goals through more favorable contracts it is negotiating with suppliers. Once those deals are concluded, he said any cost savings will be retroactive to Jan. 1.

You can reach Bryce Hoffman at (313) 222-2443 or bhoffman@detnews.com.