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Ford Says Farewell

Ford Motor Company recently dropped a bombshell—one that would have been largely unthinkable before the Great Recession. FoMoCo announced that it would be phasing out virtually all passenger cars built for the U.S./Canadian market (they will continue in Europe) by 2020, except for the upcoming Focus Active and always-popular Mustang—a move all the more grim in that it was founding father Henry Ford that pioneered the mass-market sedan for both America and the world.

The Focus will be first to go this month, followed by the Taurus next March and the Fiesta in May 2019.

Ford Motor Company was always the Eve to General Motors’ Adam in Detroit, not only making cars (and profits) by the trunkload, but leading the league in midcentury style. The “Jackie Kennedy” Lincoln Continental Town Car [1]. The Thunderbird [2]. But during the “Big Government” era of unapologetically high property taxes and ballooning environmental regulations, Ford suffered its first postwar crash. Amid the 1975 fuel shortages, Congress passed—and Detroit’s own liberal Republican stalwart Gerald Ford (despite some quibbles and misgivings) signed—the Corporate Average Fuel Economy Act (CAFÉ), which started off by requiring an 18 mpg standard by the 1978 model year (1975 models were around 13 mpg by average.)  The standard would rise to 19 mpg in 1979, 20 in 1980, and then not one but two mileage points per year through 1984—with massive, multi-million-dollar IRS and court-imposed fines if a manufacturer was found to be non-compliant.

Like a small-town mayor futilely trying to resist a federal court order, Ford mocked GM’s newly streamlined “large” cars when they debuted for 1977 (GM had been planning to go on a diet even before CAFÉ, and had vastly more R&D money than Ford or Chrysler). Ads noted that Ford’s family-priced LTD sedan was now the same length as a “downsized” (but still gargantuan by today’s standards) new ’77 Cadillac. Cynically, both Ford and Chrysler made no secret of the fact that their 1978 model full-size cars would be the last of their kind (Cadillac also let everyone know that their big 1978 Eldorado was heading for the exit door), encouraging not only the “buy it while you still can!” panic buying of the hyperinflationary late ‘70s—but also as good as telling customers that next year’s forcibly-downsized models would be decidedly inferior. Lincoln gave its Town Car and Mark V one last victory lap before they went, and Ford also renewed the Mark V’s shorter-wheelbase platform-mates the Thunderbird and Mercury Cougar for 1979. Still fuming at the imminent loss of their league-leaders, Ford so grossly overproduced for 1979 that Lincoln had a backlog of 210 days’ worth of cars by July of 1979, effectively giving them a 1980 model year. [3]

Not surprisingly, the downsized 1979 Ford (and Chrysler) “full size” sedans initially bombed—sales declined drastically for the ’79 LTD and Mercury Grand Marquis, and went off a cliff in 1980. And while the Mark VI “only” fell by half of  its 1979 numbers, the Town Car went off Thelma and Louise’s cliff—barely managing one-third of its ’79 numbers.

And all this was just a sampling of what became arguably the biggest one-year euthanasia in Ford history, as the 1980 Ford Granada and Mercury Monarch (and their upscale twin, the luxury Lincoln Versailles), and the iconic Pinto/Bobcat were all put to sleep at year’s end. All but the Granada were canceled outright, in nameplate as well as body style, with the Granada barely hanging on as a thinly-disguised Fairmont (Ford’s first big downsizing-era success, which kept the lights on at Dearborn during the 12-15 percent interest rate era from 1978 to 1983.)

Now the plot thickens. The first downsizing era was complete, but the second one, to bring things into compliance for 1984-85 (and what Detroit assumed would be even more draconian) standards, was now underway. Ford suffered catastrophic losses in 1980-82, and Chrysler had to beg a stern President Carter for a too-big-to-fail bailout in 1979-80 to avoid bankruptcy, as they frantically redesigned their slow-selling car lines yet again.

But out of this “Big Government” intrusion came the impetus to design what became Ford’s biggest successes in the mid-to-late 80s and early 90s—the 1983-88 and 1989-97 Thunderbird, the 1984-94 Ford Tempo, and the 1986-95 Ford Taurus. (Already their 1981-90 Escort flirted with #1 bestseller status in recessionary 1982.)  Meanwhile, arch-competitor GM euthanized all but the station wagons and the Chevy Caprice sedan (which lasted until 1990) of their full-size 1977 lines in spring 1984. The cars GM replaced them with were engineering marvels (except when it came to reliability, perhaps) of front-wheel-drive, V6-powered efficiency—but as folksinger Malvina Reynolds might have said, they all looked ticky-tacky and they all looked the same. GM suffered its largest decade-loss in its then-history during the ‘80s, according to auto historian Paul Niedemeyer.

But just as it had in 1978, Ford held out—and this time, the move paid off. As Presidents Reagan and Bush Sr. began relaxing CAFE laws (or at least refusing to raise the standards dramatically), the “downsized” big cars of the first wave of downsizing that still remained in production began selling like hotcakes—especially to Greatest and Silent Generation traditionalists who wanted cars that reminded them of the unapologetic luxury they drove in the 70s, when they were at the height of their earning power and still healthy. The 1991 LTD/Marquis looked much the same as they did in 1979, and the Town Car of 1989 (and its closest competitor, the ’89 Chrysler Fifth Avenue) were virtual reruns of 1980. And the Cadillac Fleetwood Brougham (the only other GM survivor of 1984-85’s “second downsizing”) was still wearing its chrome-finned, formal-roofed, stately 1977 body all the way into 1992, with only a couple of reshaped-sheetmetal facelifts in between.   

But Boomers had already been converted during the energy-conscious ‘70s to efficient Japanese (and soon, Korean) cars. (Their Gen-X and Millennial children also would have no qualms at all about buying “foreign.”) By the late 80s and 90s, the Japanese were second to none in reliability, and rising suns like Hyundai and Kia began offering league-leading, bumper-to-bumper warranties. As the Roger & Me era of globalization took hold, even the saltiest WWII and Korea veterans who were left began seriously considering Japanese and Korean autos—given that the Asian automakers were consciously building plants in the U.S. and Canada to erase the stigma of buying foreign (and head off potential tariffs), while the allegedly “all American” Big 3 were sending jobs by the thousand to Mexico, Guatemala, Venezuela, and eventually China.

The one big exception, however, was American trucks and vans—including that ultimate “soccer moms” symbol, the “minivan” (introduced by Chrysler in 1984 and Ford in 1985) and the luxury SUV. Because even the biggest global-warming advocates and environmentalists had to concede that a civilized society needed ambulances, hearses, construction, repair, and delivery trucks, and so forth, trucks were held to a significantly lower MPG standard.

Conscious of his fellow Yuppies (and not wanting to be a gloomy Debbie Down-size-er like Jimmy Carter), Bill Clinton said “No way!” to raising CAFE standards, much less cracking down hard on American-made trucks, vans, Jeeps, and SUVs that were all the rage (and already paying the Big Three’s bills) in the late ‘90s. And naturally, Texas oilman George W. Bush (with his bestie, “Kenny-Boy” Lay of Enron) and Dick “Halliburton” Cheney barely even touched fuel standards. The CAFÉ standard never rose above 27.5 mpg for passenger cars from 1985 all the way through 2010—a full 25 years.

By 2010, the US auto industry was in the worst shape since the Great Depression, if not the Carter years. GM was pulling itself out of bankruptcy, and cancelled their Saturn and Pontiac brands on Halloween 2010 (Oldsmobile had been the first to the cemetery in the relatively prosperous June of 2004). Chrysler had long ago put Plymouth and what was left of AMC/Eagle to sleep, and was even more bankrupt than GM. The only real survivor was, ironically, Ford, thanks to its European partnerships and its red-hot truck/SUV presence, and the ever-popular Mustang. (The Focus, Taurus, and Fusion were still doing well, although largely behind the Japanese and Korean majors.)  The Town Car (whose body dated to 1998) and Crown Victoria (which went back to 1991-92) finally died in early 2012, after shutting down production at the end of August 2011. And though the iconic Lincoln Continental was revived for 2017, it has largely failed to meet expectations.

So this was your life, Ford Motor Company. You invented the modern working-class hero’s sedan with the Model T, you survived and thrived as arguably midcentury middle-class America’s most iconic automaker, you stumbled badly and nearly OD’ed on gasoline and outdated styling through the last days of disco, but woke up with Morning in America. “Big Gov’mint” forced you—kicking and screaming—to innovate in ways you didn’t want to, but that kept you alive during that time. And then, when deregulation happened, and the focus became trucks/minivans/SUVs that didn’t need year-to-year changes to stay popular, you had to play it as it laid.

Fare thee well, Ford sedans and wagons. It wouldn’t have been the same without ya.

Telly Davidson is the author of a new book, Culture WarHow the 90’s Made Us Who We Are Today (Like it Or Not) [4]. He has written on culture for ATTN, FrumForum, All About Jazz, FilmStew, and Guitar Player, and worked on the Emmy-nominated PBS series “Pioneers of Television.”   

20 Comments (Open | Close)

20 Comments To "Ford Says Farewell"

#1 Comment By John_M On May 15, 2018 @ 10:47 pm

If oil prices his $100 a barrel as Citi is predicting next year (side effect of Trump’s Iran move), this could turn out badly for Ford.

I hope I have purchased my last gas car – a Prius Prime – a year ago. I am in my later 60’s and I like long range trips. At 50 mpg+ on gas, I will be able to afford to drive it when I am retired. And for my about town commuting and short trips, I am averaging over 130 mpg – relying mostly upon the battery. With luck, it will last until I am not up for long haul trips.

I hope to buy a fully self driving electric car in 4 years when I have finished paying off the Prius. My wife is directionally challenged and we are likely to be somewhat rural, making Uber-like services less able. In the mean time, she drives her 10 year old Toyota corolla, which gets quite good mileage.

I have driven gas guzzlers in my time, but given the amount I drive, I have decided to optimize my cars for reliability and mileage. The Prius replaces a Suburu Forester that got ~ 23 mpg. It had over 230,000 miles on it before it sustained enough damage from road debris that it wasn’t worth repairing.

I don’t need another suv or pickup, the kids are finally moving out.

#2 Comment By tz On May 15, 2018 @ 10:48 pm

I totally love my Ford F250 superduty powerstroke Diesel. Though I would prefer an earlier version that can do rolling coal.

#3 Comment By sglover On May 15, 2018 @ 10:58 pm

Nowadays I generally dislike nearly all of the non-Larison stuff on this site. So I’m really pleased to encounter this very fine treatment of a topic that’s got surprisingly little attention. (Or maybe it isn’t so surprising; times change.)

I grew up in Detroit & SE Mich. I left the region in the mid-80’s, in search of a functioning economy. The only thing I’d add to this article is a sense of the deep complacency of, um, the whole industrial culture, for lack of a better term. In that area you’d rub elbows with guys (usually guys) running the spectrum from line worker to Big Three engineer/manager to Big Three contractor engineer/manager. All up and down the line, they’d all simply brush away any questions about those economical foreign cars.

Anyway, again, bravo for a terrific article.

#4 Comment By Les Govment On May 16, 2018 @ 3:25 am

Excellent and interesting article by Telly Davidson.

Concerning the financial distress the US auto industry was in a decade ago, the author stated: “The only real survivor was, ironically, Ford, thanks to its European partnerships and its red-hot truck/SUV presence, and the ever-popular Mustang.”

That’s true enough. But the real key to Ford’s survival beyond 2008 (without taking a government bailout) was the mortgaging of its properties in 2006, combined with selling Aston Martin in 2007, and selling Jaguar and Land Rover in 2008.

— Les Govment [5]
.

#5 Comment By Sean On May 16, 2018 @ 7:48 am

Japan owes a great debt to the North American dealerships, for lobbying successfully for import quotas. Japan improved their vehicles immensely so as to improve their profit margins per vehicle. The rest you know.

#6 Comment By Uncle Billy On May 16, 2018 @ 10:10 am

Fordham pushed pickup trucks for the past few years because they have a large profit margin. I don’t want a pickup truck, I want a small, good quality sedan.

Marketing executives at many US companies seem to think that most American men like to drive pickup trucks and listen to garbage country music, along with drinking watery beer. No thanks. I’ll stick with my small sedan, red wine and Motown music.

#7 Comment By Omar On May 16, 2018 @ 10:12 am

I appreciate the article but like many American publications it never really addresses root issues. E.g. WHY were American companies not able to design fuel-efficient, desirable and reliable cars? They didn’t, the article makes that clear, but what the heck happened to the engineers, management, CEO’s of this and other American companies?

#8 Comment By Dan Green On May 16, 2018 @ 10:24 am

When Ford made their announcement, I took a look at the cars parked in driveways on my street. A typical middle class neighborhood. I saw two North American car, all the rest are imports.

#9 Comment By Fran Macadam On May 16, 2018 @ 11:10 am

Ford is entering the military vehicle field, as Cheney would put it, Big Time. America’s financial future lies in war export, where you get to sell at inflated prices and over and over again as they are destroyed.

#10 Comment By collin On May 16, 2018 @ 11:41 am

This seems a lot like Ford is doing the same damn thing American carmakers do which is to make larger vehicles when gas prices are down. And we have seen this will not end well, as sooner or later gas prices increase and people flock to small cars. (Yes, US government has not necessarily been positive but this is always been the US automamker failure.)

TBH, I really don’t get this strategy and gas prices are already on the way up.

#11 Comment By Mark On May 16, 2018 @ 4:21 pm

It’s a shame. After messing around with a Cobalt and a Fiesta to get good gas mileage, we discovered we could get the same or better from a Lincoln MKZ hybrid. In a much nicer car! My wife and I love this car. It’s doubtful the MKZ will survive without its Fusion sibling. Since they haven’t set the end date for them yet, I hope we can get another one when the lease is up.

#12 Comment By cka2nd On May 16, 2018 @ 5:14 pm

“liberal Republican stalwart Gerald Ford”

When I think of a liberal Republican, I think of Jacob Javits, Milicent Fenwick, Nelson Rockefeller and Richard Schweiker, not really Gerald Ford. I grant you that he governed as president as a liberal, but that seemed to me more a sop to the times than his own natural inclinations (and like his Democratic predecessors, his foreign policy was bi-partisanly bloodthirsty enough). Wasn’t Ford more the quintessential Main Street Republican that dominated the party between the extremes of Taft and Goldwater on the GOP right and Rockefeller and the Ripon Society on the GOP left?

#13 Comment By cka2nd On May 16, 2018 @ 5:38 pm

Omar says: “E.g. WHY were American companies not able to design fuel-efficient, desirable and reliable cars?”

But the Taurus was an example of that, wasn’t it? I just saw a Plymouth Reliant K – a K-car! – yesterday that looked in fabulous shape, and the K-car was what saved Chrysler in the 80’s. Were they not relatively fuel efficient and reliable?

Dan Green says: “When Ford made their announcement, I took a look at the cars parked in driveways on my street. A typical middle class neighborhood. I saw two North American car, all the rest are imports.”

True, but that’s largely because the American
companies have ceded the market. It doesn’t help that Ford’s cars have looked terrible for most of the last 20 years. GM, on the other hand, has enjoyed a design renaissance, with Cadillac (awful looking most of my life) and Chevrolet turning out real stunners the last 10 years or so. And Buick still stands for good, middle class quality and style in my book (now, about those short, seat-based instead of frame-based seat belts…). After years of blandness, the Japanese seem to have also caught onto the need for snappy design again, at least judging from the sexy recent Honda Civic (I kid you not, a sexy Civic) I saw last week. I think Fran is probably right, Ford is taking a turn to the military market, and I wouldn’t be surprised if Fiat Chrysler (with their Dodge, Ram and Jeep brands) followed in its footsteps.

#14 Comment By EarlyBird On May 16, 2018 @ 5:59 pm

What next, McDonald’s getting out of the hamburger business?!

My dad was a young executive at Ford in what I consider the Big 3’s heyday, ’59 – ’68. I am obsessed with all American cars of this era, particularly Fords.

The problem is that Ford simply hasn’t made cars which are attractive to anybody, but for the Mustang. The Japanese really do have it all over them in this area. Same for GM and Chrysler. But Lincolns are still cool.

There was a big buzz about Ford bringing out a very cool, updated retro version of the Bronco. I’ve even seen many photos of 2020 Bronco concept vehicles. I wonder if this means that will be scratched, too? Is it a truck or a car?!

#15 Comment By bt On May 16, 2018 @ 8:06 pm

The last time there was a big technology inflection, Detroit more or less gave up half their market share to the Japanese, rather than investing and innovating.

Now, we are heading into another technology inflection point, and it looks like they are going to give the other half of their market share to the Chinese and the Germans, rather than invest and innovate.

Way to go, Job-creating capitalist leaders of America. Don’t forget to blame the government for your failures on your way out.

#16 Comment By JonF On May 16, 2018 @ 8:15 pm

Re: I hope to buy a fully self driving electric car in 4 years

An electric car, sure. But a “fully” self driving car? Nope, That’s decades off– if ever.

#17 Comment By fabian On May 17, 2018 @ 2:24 pm

Looking at all the new Japanese, Korean and German sedans roaming the streets of LA, Ford’s decision is not strategic, it’s an admission of defeat.

#18 Comment By Dan Green On May 18, 2018 @ 7:32 am

The prior handle of the big three turned out a lot of junk for several years any wonder Asian cars have a handle on the US market.

#19 Comment By Alexander Martin On May 18, 2018 @ 5:27 pm

To a certain extent, I think what happened here is a Detroit problem. I grew up there. When I got out of the Navy they asked me if I was going back. I laughed and settled in L.A. where I’ve been ever since. I’d always noticed something about Detroit, automakers and workers especially: if something was new or challenging, they saw it as stupid. Those Japanese cars? “Ha Ha Ha.” Oh really? How did that work out for you? Occasionally, I go back to visit family. The place and attitude hasn’t changed. The old argument about what killed Detroit – was it the unions, the automakers? No, Detroiters killed Detroit. Sayonara

#20 Comment By muad’dib On May 18, 2018 @ 7:39 pm

But a “fully” self driving car? Nope, That’s decades off– if ever.

I find your lack of faith disturbing.