Ford Says New S.U.V.'s Less Fuel-Efficient Than Old Ones
EARBORN, Mich., July 18 — The Ford Motor Company's sport utility vehicles will be less fuel-efficient in the 2003 model year than the previous year, the company said in a new report.
Earlier this year, the company said it could not meet a pledge to raise the fuel economy of its sport utility vehicles by 25 percent from 2000 to 2005. But the report indicates that Ford is actually moving backwards in its S.U.V. fuel economy. In the 2002 model year, the company's sport utility vehicles were 8.4 percent more efficient than the vehicles the company made in the 2000 model year. But the S.U.V.'s produced this year are only 5.2 percent more efficient than those made in the 2000 model year, according to the company's corporate citizenship report.
The report pointed to declining fuel economy in the company's Land Rover division and declining sales of its small S.U.V., the Escape. It also said fuel economy had been worsened by the introduction of the Lincoln Aviator, a luxury S.U.V. only slightly smaller than the burly Navigator.
"We were not able to make the investments in the products and technologies needed to meet the goal, nor were some of the technologies as mature as we thought," Ford's chairman and chief executive, William Clay Ford Jr., said in a letter included in the report.
"But I do reaffirm our commitment to continue to work toward improving the fuel economy of our S.U.V.'s and, indeed, to cutting greenhouse gas emissions across our entire range of vehicles," he said.
The shortfalls in S.U.V. performance were reported today by The Detroit Free Press.
"When you look at Ford's report, they're failing to meet their commitment," said David Friedman, a senior policy analyst at the Union of Concerned Scientists, an environmental group. "They were gambling on a market shift to smaller S.U.V.'s instead of putting technology to work to make their mainstream products do better. Instead, their mainstream products did worse."
Environmental concerns appear to be low on the priority list as the company opens labor talks at its Dearborn headquarters today with a handshake between Ford executives and union negotiators.
For Ford, a top priority will be getting the United Automobile Workers union to accept four plant closings in the United States laid out in the company's turnaround plan, including a plant in Edison, N.J., that produces the Ranger pickup.
"We will need to get the U.A.W. to understand and agree to close the plants we identified," said Dennis J. Cirbes, Ford's vice president of labor affairs, at a news conference.
The company, which lost $6.4 billion in 2001 and 2002, returned to profitability in the first half of the year. But Ford officials said on Tuesday that they expected profits to be flat for the second half of the year.
Today, Nicholas V. Scheele, the company's chief operating officer, wrote in an e-mail to its white-collar workers that the costs of its salaried work force would need to be cut by 10 percent. He said the cuts would be made through hiring freezes, attrition and less overtime.
"However, where these actions cannot fully meet the targets, we will have to reduce our salaried personnel structure to address the balance," he added in the e-mail. Ford spokesmen declined to say how many jobs might be cut.
"We still face uncertain economies around the globe and a fiercely competitive marketplace," Mr. Scheele added in his e-mail.
U.A.W. leaders have said the preservation of health-care benefits is a top priority as costs skyrocket. But analysts and labor experts believe the union will give some ground on other issues. Labor talks continue until the contract expires in mid-September.
Mr. Ford, the great-grandson of Henry Ford, the company's founder, has often been outspoken on issues like global warming, at least by Detroit standards.
But he has also been sharply criticized by environmentalists for not making much progress since becoming chief executive in 2001.
"We can't contribute to a socially, environmentally and economically sound future if we are not successful in executing the basics of our business — providing desirable, high-quality, affordable products to our customers and doing so profitably," Mr. Ford said in his letter.
"The first line of corporate citizenship is being a responsible employer to the 350,000 people who work at Ford. That has been my focus for the past year and a half."
