July/August_AMP_Digital

A D V A N C E D M A T E R I A L S & P R O C E S S E S | J U L Y / A U G U S T 2 0 2 0 2 8 The renewed focus on Ford meant the end of shared platforms with Maz- da and an opportunity to reevaluate all existing platforms. Within a month, the Mid Term Sustainability Project (MTSP) had begun, covering the four highest volume platforms within the company. The new project aimed to define the strategy that would deliver the greatest fuel economy improvement to the cor- poration while protecting profits and minimizing risks and investments. The three high-volume car platforms (B, C, and CD) went under the microscope, but they all faced the same four funda- mental obstacles: With production scat- tered around the world, converting any of these global platforms would pres- ent unmanageable logistical and in- vestment challenges; the absence of a local supply of aluminum auto body sheet (ABS) in China and South America was another one; analysis of the three platforms quickly revealed that light- weighting smaller, already fuel-efficient vehicles did not eliminate the need for costly powertrain actions; and finally, none could afford a pricey but invisible technological innovation. A customer could understand a price premium for an advanced powertrain, but marketing a lightweight body was nearly impossi- ble in this market segment. By the end of October, the studies had concluded that high-volume cars did not yet make suitable targets for aluminum body structures. RECESSION CONTINUES Around Ford, the economic situa- tion continued to deteriorate. TheHous- ing and Economic Recovery Act of 2008 was enacted on July 30. On October 3, with the economy in free fall, Congress passed the Emergency Economic Stabi- lization Act of 2008. Barack Obama won the presidential election on November 4. Three days later, Ford declared a $3 billion loss for the third quarter, ac- companied by a 25% plunge in U.S. sales, prompting an announcement of additional layoffs and investment re- ductions. Two weeks later, in a desper- ate search for cash, Ford revealed it was selling its controlling stake in Mazda for $450 million. The Term Asset-Backed Securities Loan Facility was announced the day before a somber Thanksgiving. Within three weeks, the federal funds rate was lowered to zero. By that time, the new layoffs had been carried out: Like most of Ford’s engineering organi- zation, Stamping Engineering had lost half its pre-2006 headcount. The year 2009 began with an- nouncements of record losses for both the aluminum and auto industries, and by March 6, the Dow Jones Industrial Average had tumbled to 6443. Among the various corporate readjustments, Novelis announced on May 8 that Phil Martens had been named president and COO. Martens was a seasoned automo- tive executive, having served as Ford’s VP of North American Product Devel- opment before his departure in 2005. Further, he was familiar with Ford’s AIV technology and he brought to Novelis a conviction that automotive ABS would be the next growth opportunity. Ford was not the only compa- ny working on the future, and on March 26, Tesla present- ed a prototype of its upcom- ing all-electric Model S to the press. With Chrysler and GM fil- ing for Chapter 11 bankrupt- cy, the first half of 2009 was an exercise in survival, with sales hovering at 60% of their pre-crisis levels. All along, the Obama administration was working to stabilize the economy and on June 23, Ford received a $5.9 billion loan from the Department of Energy’s Advanced Technology Vehi- cles Manufacturing Loan Program. Meanwhile, the MTSP quietly con- tinued. It was focused on the one plat- form that offered the magic combina- tion of volume, profit margins, and fuel economy impact: F-150. It had the addi- tional advantage of being a North Amer- ica only platform, where the Ford AIV engineering and manufacturing know- how was concentrated. On July 10, the day before GM emerged from bankrupt- cy, the five engineers of the aluminum technology team met in a small confer- ence room at Ford’s Research and In- novation Center in Dearborn, Michigan. Elizabeth Hetrick, Andy Sherman, Pete Friedman, John Hill, and Laurent Chap- puis were asked to confirm the material U.S. light vehicle sales along with gas and aluminum London Metal Exchange (LME) prices. Elon Musk presents Tesla’s Model S, March 26, 2008. Courtesy of Noel McKeegan/New Atlas.