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http://www.reuters.com/article/marketsNews/idINN2842283020081029?rpc=44

DETROIT, Oct 29 (Reuters) - Ford Motor Co is rolling out a sharply simplified vehicle line-up for the 2009 model-year by slashing thousands of configurations of features from its order book in a bid to cut costs and smooth showroom transactions.

For Ford (F.N: Quote, Profile, Research, Stock Buzz), getting back to its roots as a provider of solid transportation for the masses means making it much easier for a customer to research a car in the modern way, online, and find it at a local dealership.

The end result, Ford hopes, is a simpler manufacturing process with lower costs and easier sales for its dealers, who also could see inventory carrying costs go down with fewer undesirable models sitting unsold on their lots.

Most customers buy vehicles from the existing inventory at the dealership, so customers who do not find the cars they saw online at the dealer lot may leave empty-handed or a sale will require increased incentives.

The number of orderable configurations has been cut by 90 percent from the 2008 model year to 2009 -- reductions that reach 95 percent from the 2008 to 2010 period.

For example: the Ford Edge crossover could have been ordered 14,208 ways in 2008, and by the 2010 model year customers can order it in 204 potential configurations.

The Ford Escape had 5,472 possible combinations in 2008 and will have 429 in 2010.

And the 2010 Ford Fusion sedan will have 104 possible combinations, down from 2,602 in the 2008 model year -- including a "Rapid Spec" package of features Ford expects to make up about 25 percent of the overall sales of the Fusion.

That particular Fusion package includes power seats, windows and door locks, cruise control and an adjustable steering wheel with integrated audio controls for a stereo with compact disc player and the ability to hook up an MP3 player, satellite radio, moonroof, and the Ford Sync system.

Japanese automakers have focused for years on cutting costs by using common parts such as seat frames and latches that customers do not see, and offering options in simple groupings that reduce manufacturing costs and increase revenue.

Ford's reductions stemmed from a study conducted by nearly two dozen employees and a handful of dealers to find out what customers wanted in areas around the United States and increase their odds of finding the right vehicle on a sales lot.

The Ford team included representatives in marketing and sales through finance, with input from product development and manufacturing, where fewer combinations will reduce engineering and manufacturing costs as well.

"Less certainly can offer more to customers," said Brad Munn, Ford's cross-vehicle product strategy manager. "A tighter focus on delivering the combinations our customers want most can yield benefits across the board."

Ford has aimed under Chief Executive Alan Mulally to unify vehicle development to take advantage of global scales, and pare the dizzying array of vehicle ordering combinations.

The automaker has made progress under the plan, increasing its lead over U.S.-based rivals General Motors Corp (GM.N: Quote, Profile, Research, Stock Buzz) and Chrysler [CBS.UL] in Consumer Reports' new vehicle reliability rankings, though still trailing the top transplant automakers.
 

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Wow, what an amazing concept--making it easy on the customer to buy a car. I know of another car company that could try to do the same! ;)
amen to that. just going over a deal with our GSM here. if we use a lessee loyalty, it can be transferred to her fiance', but that means she'll have to change her address so it shows they live together. meanwhile, we can't combine that with conquest cash, as we're using the gms pricing....I mean how much more effed up can they make this process?? do you remember the good old days of 2000, when it was a simple rebate OR special finance rate? but, then they had to go and "improve" it.....
 

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This initiative dates back to when Mulally first took over as CEO.

One of the first things he did was buy a big E-Series van for his mother's retirement home, and realized the van had MILLIONS of different ways to configure it, which was very confusing for customers and dealers. It made ordering difficult for customers, and it made it difficult for dealers to pick the right configurations for lots.

Honda has it right. Pick the options group, then pick the engine, then pick the colors. Done. I know we all love cherry-picking through the order sheets, but for most customers, it can be very frustrating.
 

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Ford management gets it and I think they will be alright, at first it still seems like a lot of configurations but than you take into account colors and you realize it isn't.

For a car like the Fusion you should have 2-3 trims with each engine choice and a tech package available on the highest trim. But Ford does offer things like AWD on it, so if that's a popular option they'll probably have to keep that around.
 

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Good for them. The easier it is to find the car you want quickly the more likely you are to buy one.

I recall back in the 90's GM was toying with the idea of making ordering a car much quicker. Something like 10 days from order to delivery? Anyone remember that? I think a lot more people would order cars and get exactly what they wanted if it didn't take so long.
 

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If the ordering process only took 10 days, dealers wouldn't stock as much and would save on floorplan, but maybe not if configurations were easier. We have seen some moves to do this. It seems as if GM has made small strides to make ordering more effecient, but this should help Ford's effeciency big time.
 

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When they count combinations, does that include interior and exterior color and dealer accessories?

If it does, then the cuts look good.

But if you can still order a Ford Edge 204 different ways not counting color and dealer accessories, then Ford has simply gone from "an insane number of options" to "a ludicrous number of options".
 

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When they count combinations, does that include interior and exterior color and dealer accessories?

If it does, then the cuts look good.

But if you can still order a Ford Edge 204 different ways not counting color and dealer accessories, then Ford has simply gone from "an insane number of options" to "a ludicrous number of options".
It includes colors. Not dealer accessories.
 

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Good idea.

Except Ford "borrowed" it from GM.

GM reduced the number of ways a car could be built years ago. Supposedly, the build/ship time was reduced at the same time. That part hasn't worked so well.
 

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Honda has it right. Pick the options group, then pick the engine, then pick the colors. Done. I know we all love cherry-picking through the order sheets, but for most customers, it can be very frustrating.
Exactly we all LOVE it. So they take it away because dealer's overstock anyway and having what you want has become to expensive.

:rolleyes:
 

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Exactly we all LOVE it. So they take it away because dealer's overstock anyway and having what you want has become to expensive.

:rolleyes:
No... MOST car buyers, not the psychopathic looney tunes who post here, don't have any desire to weed through 13 pages of optional equipment.

Keep it simple.

For full disclosure, I'd love nothing more than to leaf through 200 pages of random optional features to pick the perfect combo. But I also recognize the realities of the market.
 

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No... MOST car buyers, not the psychopathic looney tunes who post here, don't have any desire to weed through 13 pages of optional equipment.

Keep it simple.

For full disclosure, I'd love nothing more than to leaf through 200 pages of random optional features to pick the perfect combo. But I also recognize the realities of the market.
ditto. I think the big thing here is that looking for a car can be incredibly emotional. You may build the perfect car on the internet, and if you can't find that particular one, you're disappointed. Having less possibilities means less chance to be disappointed with dealer inventory.
 

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This initiative dates back to when Mulally first took over as CEO.

One of the first things he did was buy a big E-Series van for his mother's retirement home, and realized the van had MILLIONS of different ways to configure it, which was very confusing for customers and dealers. It made ordering difficult for customers, and it made it difficult for dealers to pick the right configurations for lots.

Honda has it right. Pick the options group, then pick the engine, then pick the colors. Done. I know we all love cherry-picking through the order sheets, but for most customers, it can be very frustrating.
The concept is as old as the business itself.

Classic Combinatorics.

The modern era of this 'started' with Chrysler about 2 months after the first oil shock in October of '73 in regards to the rest of their MYr '74 production.

Like everything else in life there is a time to expand and a time to contract - and this is definitely the right time to do what they're doing - assuming intelligent execution.

That said, you can go too far with it - it all depends on the numbers and data - or the expectations of that.

If this does count all exterior interior trim combinations - depending on how large that number is then 204 is possibly more than a bit low - unless you really don't expect to sell that many.

Most do not really have a feel for how easy it is to drop build configuration numbers to simple numbers such as 1/2, 1/4, 1/8.

As a simple real world example, suppose an OEM offers 2 types of spare tire selections across the board counting fleet.

Drop one, and you just cut your configuration build number in 1/2.

Now suppose on the same vehicle they offer in the exact same location within the vehicle a choice of an ash receiver/lighter, a blank position, or a power outlet - again across the board counting fleet.

Now drop the blank build choice.

You just dropped your build possibilities to 2/3s.

Now do the math for doing both together.

(#BUILD/ ALL OTHER FACTORS) x 1/2 x 2/3 = 1/3.

So, by limiting these two you can cut the build configuration number by 2/3s.

Go one step further.

Drop one color out 10 available across the line - counting fleet. ( Typically one of two solid whites available is 'easy'.)

Now it becomes (# - other) x 1/2 x 2/3 x 9/10 = 3/10 ie 30%

Three super simple relatively in consequential changes - and you 're at 30%.

None of this is really going to have a large impact on cost or quality, btw.

Typically (but not always ) its not that hard to drop to 10 - 20% with some simple fleet segment change ups etc. or similar for retail.

This is especially true if there are 'large fleet order' only options available.

Full size Vans and trucks that sell commercial are a whole different animal and its extremely misleading to compare their configuration numbers to things like compact or mid size cars.
 

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Honda has it right. Pick the options group, then pick the engine, then pick the colors. Done.
Almost- they have all kinds of things as expensive dealer-installed accessories (e.g. fog lights and rubber body side moldings on some models).
 
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