Chairman of Ford Motor Company on why he wants to sell fewer cars

Ford Chairman of the Board, William Ford, addresses shareholders at the Ford 57th Annual Meeting of Shareholders May 10, 2012 in Wilmington, Del.

An auto company that thinks we should drive less? That could be the future strategy for Ford Motor Company, according to Bill Ford, executive chairman of the company.

“The car for most of its history has helped people live better lives,” he says. “As the world has gotten more affluent, the infrastructure, particularly in urban areas hasn’t developed to a point where this great new volume of new vehicles will fit comfortably into those cities."

“I could not reconcile the traffic jams that I was seeing [in global cities] with the fantastic projections that some in our industry were putting out there for future sales in some of these markets.” Ford says an emphasis on public transportation is still in keeping with the greater goals of the Ford Motor Company. “What I’m talking about is providing mobility to the people who live in those mega cities in a way that might be slightly different than the way we have today.”

He hopes shareholders will bet on his long term vision for the company. “The world changes whether you change or not. So we are entering into an era where if we are open enough to embrace new business models and new technologies, then this actually will enhance the core business of the Ford Motor Company.”

Ford says, “technology is what’s going to ultimately set us free.” And in some ways, it’s here now -- in the guise of self-driving cars. Vehicle-to-vehicle communication (cars that talk to each other) and vehicle to infrastructure communication (cars that pull data from their environment) are all bringing us closer to Ford’s vision.

But the future isn’t here yet and there are some roadblocks. “I’ve often advocated a gas tax,” says Ford, “but there really is no political will for that.” He says the U.S. needs a consistent energy policy. “Until our country really decides which fuel it wants to get behind and then builds out the infrastructure behind it, we are not going to have quick enough adoption to really help solve the issue."

About the author

Kai Ryssdal is the host and senior editor of Marketplace, public radio’s program on business and the economy.
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So let’s follow this thought a bit more; shall we? The world uses about one cubic mile of oil (or CMO) each year, about 80% of which goes for transportation, and we only have about 700 million cars. Mr. Ford is talking about powering 4 billion cars, possibly requiring 3 CMOs of energy assuming the future fleet is twice as fuel efficient as today’s fleet. What does it take to produce even one CMO/year worth of energy from any fuel? Say you want it to be electricity. It takes 200 dams of the Three-Gorges Dam variety to produce 1 CMO/year. Give yourself 50 years to get the infrastructure ready, and you need to build one Three Gorges-Dam like facility somewhere in the world every quarter. Nuclear? You will need 2500 Diablo Canyon-style reactors. Commission a new plant every Monday for the next fifty years. Solar? Start operating a new solar park, 10-times the Andasol facility every Monday, Wednesday, and Friday for fifty years. Biofuels? Current global production of biofuels will have to increase 60 fold. Just the land area required to produce 1 CMO/yr of biodiesel from rapeseed is about 2 million square miles, or about 10% of all arable land in the world.

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