Global traffic gridlock fuelled by increased migration to big cities was a “severe threat” to the traditional carmaking pioneered a century ago by Henry Ford, his great-grandson said this week.
“Prior to the Model T, most people never travelled more than 25 miles (40km) from home in their entire life. It really allowed people to choose where they played, where they worked and where they lived,” Bill Ford, 57, executive chairman of Ford, said at the Intelligent Transport Systems World Congress in Detroit.
“That model of mobility is under severe threat.”
Over the next decade, there will be a 25 percent to 50 percent increase in urban dwelling, as about 1 billion people move into cities, consultant PricewaterhouseCoopers has said.
In 25 years, there will be 9 billion people living in urban areas – more than the entire population of Earth today.
If they are all driving cars, gridlock could block the path of food, water and emergency medical treatment in cities, it said.
Ford was rethinking its mission as a carmaker and testing a variety of alternative forms of mobility around the world, Bill Ford said.
As the buying power of emerging nations grew, an ever increasing number of cars could become a burden on society, he said.
“Where are we going to put them, where are we going to drive them?” Ford said.
“You cannot shove two cars in every garage in Mumbai. In fact, that’s preposterous.”
The coming changes “require us to be a very different kind of company than we’ve been”.
The group was heavily researching self-driving cars and felt the technology could be ready by 2020, though governments may not have created the laws and infrastructure to support it by then.
“There are policy issues around it, there’s customer acceptance issues, there are infrastructure build-out issues,” Ford told reporters after his remarks. While the technology would be ready in 2020, “will all those elements be in place to enable it”?
Ford established a partnership three years ago to provide vehicles to car sharing service ZipCar.
For now, the group still makes its money the old-fashioned way – building and selling cars and trucks.
Ford sold 763 402 F-Series pickup trucks in the US last year, making it the top selling vehicle in the country for the 32nd year and driving the firm’s North American pretax profits to a record $8.78 billion (R96.5bn).
This year, Ford has said its profits will decline as it spends to overhaul factories to introduce 23 new models worldwide.
It reported net income of $2.3bn for the first half of the year, down from $2.84bn a year earlier.
Ford’s American car and truck sales fell 0.3 percent this year through to the end of August, to 1.7 million vehicles. Its American market share fell to 15.2 percent, from 16 percent during the same period last year, according to researcher Autodata. – Keith Naughton for Bloomberg