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The Fordasaurus

The Fordasaurus
CASE 7.3 The Fordasaurus
before ford publicly unveiled the bigg est sport- utility vehicle ever, the Sierra Club ran a contest for the
best name and marketing slogan for it. Among the entries were “ Fordasaurus, powerful enough to pass
anything on the highway except a gas station” and “ Ford Saddam, the truck that will put America
between Iraq and a hard place.” But the winner was “ Ford Valdez: Have you driven a tanker lately?” 106
Ford, which decided to name the nine- passenger vehicle the Excursion, was not amused. Sales of sport-
utility vehicles ( SUVs) exploded in the 1990s, going up nearly sixfold, and the company saw itself as
simply responding to consumer demand for ever larger models. Although most SUVs never leave the
pavement, their drivers like knowing their vehicles can go any-where and do anything. They also like
their SUVs to be big. Before the Hummer passed it, the Excursion was the largest passenger vehicle on
the road, putting Ford well ahead of its rivals in the competition to build the biggest and baddest SUV.
The Excursion weighs 8,500 pounds, equivalent to two midsize sedans or three Honda Civics. It is more
than 6 ½ feet wide, nearly 7 feet high, and almost 19 feet long— too big to fit com-fortably into some
garages or into a single parking space. Although the Excursion is expensive ($ 40,000 to $ 50,000 when
loaded with options), it is, like other SUVs, profitable to build. Because Ford based the Excursion on the
chassis of its Super Duty truck, the company was able to develop the vehicle for a relatively modest
investment of about $ 500 million. With sales of 50,000 to 60,000 per year, Ford earns about $ 20,000 per
vehicle. Classified as a medium- duty truck, the Excursion is allowed to emit more smog- causing gases
than do passenger cars. However, Ford says that the Excursion, with its 44- ­gallon gas tank, gets 10 to
15 miles per gallon and that its emission of pollutants is 43 percent below the maximum for its class. By
weight, about 85 percent of the vehicle is recyclable, and 20 percent of it comes from recycled metals
and plastics. The company thus believes that the Excursion is in keeping with the philosophy of William
Clay Ford, Jr. When he became chairman in September 1998, he vowed to make Ford “ the world’s most
environmentally friendly automaker.” He added, however, that “ what we do to help the environment
must suc-ceed as a business proposition. A zero- emission vehicle that sits unsold on a dealer’s lot is not
reducing pollution.” The company, however, has failed to win environmentalists to its side. They believe
that with the Excursion, the Ford Company is a long way from producing an environmentally friendly
product. Daniel Becker of the Sierra Club points out that in the course of an average lifetime of 120,000
miles, each Excursion will emit 130 tons of carbon dioxide, the principal cause of global warming. “ It’s
just bad for the environment any way you look at it,” he says. John DeCicco of the American Council for
an Energy- Efficient Economy agrees. He worries further that the Excursion is clearing the way for bigger
and big-ger vehicles. “ This is the antithesis of green leadership.” Stung by criticism of the Excursion, Bill
Ford vowed to make the company a more responsible environmental citizen. Worried that, if automobile
producers didn’t clean up their act, they would become as vilified as cigarette companies, in August
2000 Ford promised it would improve the fuel economy of its SUVs by 25 percent over the next five
years, smugly inviting other automakers to follow its green leadership. To this GM responded that it was
the real green leader and “ will still be in five years, or ten years, or for that matter twenty years. End of
story.” When they aren’t bragging about their greenness, however, both companies continue to lobby
Congress, and battle in the courts, against new mandates on emissions and fuel efficiency. Update Ford
Motor Company failed to keep its promise to improve fuel economy by 25 percent by 2005, but it has
now phased out the Excursion. After a five- year stint as president and CEO of Ford, Bill Ford remains
chairman of its board of directors and is still hoping to push the company toward a greener future.
Recently, the com-pany introduced the Escape, an SUV that is a gas- electric hybrid, and Ford’s research-
and- development people are working hard on developing a hydrogen engine. Still, Ford is filling the void
left by the Excursion with an extra- long version of its Expedition. Not only do gas guzzlers continue to
roll out of Detroit’s assembly plants, but some of the automakers’ supposedly environmentally
conscious efforts— consider the new Cadillac Escalade Hybrid— seem to be a sham. Perhaps that is not
so surprising when one finds Bob Lutz, vice president of GM, stating in 2008 that hybrids like the Toyota
Prius “ make no economic sense” and that global warming “ is a total crock of [ expletive].” However,
with higher gas prices and the average fuel economy of new vehicles sold in the United States no bet-ter
than it was twenty years ago, the backlash against SUVs is growing. Environmentalists have now been
joined by con-servatives, who in the aftermath of the wars in Iraq and Afghanistan, are worried about
supporting Middle Eastern oil producers who fund terrorism, and by evangelical groups, whose bumpers
stickers ask, “ What would Jesus drive?”
1. Are environmentalists right to be concerned about the environmental impact of SUVs? How do you
explain the demand for ever larger passenger vehicles? Will higher gas prices change that?
2. In developing and producing the Excursion, was the Ford Motor Company sacrificing the environment
to profits, or was it acting in a socially responsible way by making the Excursion relatively energy
efficient for its vehicle class? If you had been on the board of directors, would you have voted for the
project? Why or why not? Do Ford’s stockholders have a right to insist that it produce the most
profitable vehicles it legally can, regardless of their environmental impact?
3. Assess William Clay Ford’s promise to make his company the “ world’s most environmentally friendly
auto-maker.” What are the environmental responsibilities of automakers?
4. Is Ford Motor Company simply responding to consumer demand for large vehicles, or is it helping to
shape and encourage that demand?
5. Should there be tighter pollution restrictions on SUVs? Should the government try to discourage the
production and use of SUVs?
6. Is it moral or environmentally responsible to drive an SUV? What would Jesus drive?

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