Gorman: Territory success gives Ford Oz new Asia-Pacific role

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Ford to trade on Territory success

Global SUV: small but important export deal with South Africa has increased Ford Australia's standing within the Asia-Pacific Ford world.

Ford Australia's regional Asia-Pacific design role gains momentum

By TERRY MARTIN 29 March 2005

THE Ford Motor Company expects to see its Australian operation play a more forceful role in vehicle development throughout the Asia-Pacific region.

According to Ford Motor Company vice-president and Asia Pacific and Africa chief operating officer, Peter Daniel, the success of the Broadmeadows-built Territory and the breakthrough export deal struck with South Africa, had strengthened Ford Australia’s standing as a supply source in the region.

"As you’ve seen with the Territory, I think Australia has been acknowledged globally now within the Ford system to say they’re a credible PD (product development) source, so longer term we’ll have to explore more what we can do to utilise Australia across our region," Mr Daniel said.

"I think there’s the capability there to lunch off what they’ve already shown with Territory and what they’re capable of doing. So I would, longer term, expect to see Australia play a forceful role in PD within the Asia-Pacific region."

Mr Daniel said rising affluence levels in ASEAN countries had also made Australia a better prospective vehicle source, however he stressed that future export contracts would hinge on governments striking more free-trade agreements in the region.

"As the free trade opens up between Australia and the rest of Asia, that creates potential opportunities for us with the Territory," he said.

"There is a free-trade agreement between Australia and Thailand – that opens up a possibility for us to explore the business opportunities further – (and) if we can get further breakdown with free trade, that will potentially open the door for more exports."

In addition to trade, further export barriers for Ford Australia include production constraints at Broadmeadows, the substantial amount of additional investment required to make Territory compatible for left-hand drive markets, and product similarities across different Ford operations that can force two or more operations to compete for a single export deal.

Ford’s RWD vehicle platform for the Middle East derives from North America, for example.

"We’re looking at expanding our platforms and using them across regions globally and then there is, in a lot of cases, a ‘beauty contest’ between which one you choose – which one is more efficient, which one is more or less investment than the other," said Ford Motor Co executive vice-president and Asia Pacific and Africa president, Mark Shulz.

Mr Schulz said new export deals were not considered a "critical" requirement in ensuring Ford Australia’s future as a vehicle manufacturer – but that new opportunities should nonetheless be sought.

"I don’t know that it’s critical, but I would say that all the affiliates that we work with should look for opportunities," he said.

Announced earlier this month, Ford Australia’s export deal with South Africa will initially be worth 2000 Territory models per annum. Deliveries start in April.

"This is a big step, really, for the whole Ford Australia team," said Ford Australia president Tom Gorman. "We’re now recognised within the Asia- Pacific team as producing outstanding vehicles and to add South Africa to our list of export customers is a big step forward for us.

"We’re going to put it out there and see how it takes and then we’ll decide where we go from there."

Well good news for Ford, all of a sudden exports are a reality it seems, so it will be interesting to see how long their (so far very efficient) single shift of the Broadmeadows plant lasts. Theyve been struggling to meet demand lately, namely the Falcon Ute sales taking a dive to maintain 2000 Territory sales per month, and with another 2000 Territory's going to South Africa per year now, they'll be looking at a more drastic way at increasing output than their past efforts of speeding up the individual build time.

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Any chance there might be a 2nd shift starting up down there ?

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They havent really said anything. As ive said countless times their single shift strategy muts be working pretty efficiently to pump out 500 cars per day, especially compared to Holdens 3 shifts which yields only 800-850 cars per day. Adding another shift could change that, there'd be less pressure on the workers and that could have either a good or bad effect on quality control, something they were worried about when they cut back the assembly time from about 57 seconds to around 51 seconds, but Ford claims that increased quality