Expert answer:Case Questions

Solved by verified expert:Please read the three sources of the case (two website link and one pdf) and answer three questions in the word doc.McCracken, G. (2010). How Ford Got Social Media Right. HBR Blog network (Links to an external site.)http://brandchannel.com/2012/05/09/ford-fiesta-sal…
wsj_may_2010_article___2011_ford_fiesta_ses_five_door__small_wonder___rumble_seat_by_dan_neil___wsj.pdf

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6/17/2017
2011 Ford Fiesta SES Five-Door: Small Wonder | Rumble Seat by Dan Neil – WSJ
This copy is for your personal, non­commercial use only. To order presentation­ready copies for distribution to your colleagues, clients or customers visit
http://www.djreprints.com.
http://www.wsj.com/articles/SB10001424052748704370704575228112106450630
RUMBLE SEAT
Small Wonder: The Fiesta Delivers
Ford’s little car packs cool amenities and exterior, but avert your eyes from that Playskool
dashboard plastic
By
Dan Neil
Updated May 8, 2010 12:01 a.m. ET
Drawing on its deep global resources in the cheap, runty econobox segment,
Ford has delivered to Americans the 2011 Fiesta. To say it’s a fine little car is not
exactly an acute observation. It’s the best-selling car in Europe and is busy
putting its tiny foot on the neck of other world-wide markets. To bullet-point the
matter: Under $14,000 to start; 120 horsepower and 40 mpg highway; sedan or
five-door hatchback; segment-leading electronic amenities; seven airbags; built
like a Russian gymnast.
The drama of the Fiesta lies all in its
back story. Who built it; how did it
come about; who’ll buy it in the U.S.; and finally, what took so long?
As to the latter, well, frankly, you were the problem. Americans are positively
erratic when it comes to small cars. Sure, when gas prices are $4.50 a gallon,
buyers pour through dealership doors like it’s July 14 at the Bastille, trying to get
their hands on fuel-efficient cars. But as soon as fuel prices slacken, so does
small-car fever.
This dynamic has kept American auto
makers from bringing the good small
cars they build and sell overseas to the
U.S. market, where they figured, not
unreasonably, that they would take it
in the shorts. It denied carmakers the
opportunity to fully realize
economies of scale, since they were
obliged to leave out the world’s
second-largest car market (behind
China). It meant losing precious
FORD
leverage with suppliers, and thus a
slimmer margin, in a segment where
margins are already slighter than Miley Cyrus lyrics.
THE 2011 FORD FIESTA
There’s history here: In the 1990s Ford attempted to sell Americans on its
global-platform midsize Mondeo cars. The Ford Contour/Mercury Mystique
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2011 Ford Fiesta SES Five-Door: Small Wonder | Rumble Seat by Dan Neil – WSJ
were actually pretty decent but failed to resonate with American buyers,
perhaps because the back seat was so mercilessly small and our butts are so
dauntingly big. It turns out, America is hell of a place to sell cars. The clientele
has peculiar tastes, including engines more powerful and thirstier than buyers
want overseas; federal safety and emissions requirements are usually more
stringent than required by other countries; and every variance that carmakers
are obliged to make in adapting a world car to U.S. regs—a process called
homologation—costs money. See above, margins, Miley Cyrus, etc.
Enter harmony.
Global emissions and
crash standards are
merging, in a slowmoving process
called
harmonization. Ford
execs estimate that
about 80% of any
Fiesta is identical to
another, whether the
cars are sold in São
The Fiesta’s aggressive exterior styling includes oversize quad headlights. FORD Paulo or Shenyang.
Meanwhile—and this,
to me, is the fascinating part—global tastes are coming together, which suggests
that global cultures are as well.
Can it be that Americans, with their bare muddy feet and big straw hats, are
growing less provincial?
The Ford Fiesta will soon see.
Brass tacks time: The Fiesta is a B-segment, or compact, car (160.1 inches long in
five-door trim, or 173.6 inches as a sedan) over a 98.0-inch wheelbase. In the U.S.
the car is powered by a hugely overachieving 1.6-liter in-line four cylinder (with
variable valve timing on inlet and exhaust cams) coupled to either a five-speed
manual or a very capable six-speed, dual-clutch automatic (marketed rather
ridiculously as the PowerShift transmission, as if you’re going to be dropping the
hammer at the Gatornationals).
With the automatic, the Fiesta gets a
claimed 30/40 miles per gallon,
city/highway. With the manual, those
numbers slip to 29/38 mpg. Both figures
easily beat the presumptive favorite in
the class, the Honda Fit.
The bare-bones model is the S Sedan
($13,320), while my test car for the week
FORD
was a top-of-the-line SES Hatch
($17,120), in taxi yellow. I liked it so
much I almost put it in my carry-on luggage for the trip home.
The five-door is a terrific-looking little car, brawny and close-coupled, with a
sweeping forward thrust to the body panels and kind of crazy oversize quad
headlamps drawn up over the front fenders. The SES trim level comes with
proper alloy wheels; body-colored grille, mirrors and door handles; and bosslooking LED parking lights inside mirrored bumper bezels. In this segment, it’s
hard to build anything that doesn’t look purely twee and adorable (cf., Honda Fit
or Chevy Aveo), so even a trace of malice, as the Fiesta has, amounts to carstyling genius.
The U.S. marketing plan targets primarily millennials—figure, those born 1985 or
after—and the Fiesta will reward these first-timers richly. Among the upscale
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2011 Ford Fiesta SES Five-Door: Small Wonder | Rumble Seat by Dan Neil – WSJ
features is a push-button start system with keyless entry; ambient lighting with
a driver-selectable choice of seven colors; optional heated side-view mirrors;
and standard SYNC in-car connectivity, through which you can operate your
Bluetooth device by voice command. The SYNC system also can notify 911 in the
event the vehicle’s airbags go off (worried parents, take note). A new dimension
for the SYNC system is the capacity to deliver real-time traffic updates and turnby-turn navigation.
I used this system around Los Angeles and, while it’s not the most pleasant
interface—the computer voice sounds like Mrs. Krabapple of “The Simpsons”—it
will talk you through whatever route you’ve chosen.
The Ford project guys are quite proud of the interior, so I waited until they left
our briefing to stick my finger down my throat. The Captain Nemo-style dash
console, with buttons for various car functions, is quite nice; but the tiny 4-inch
orange-monochrome LCD screen looks like a vagrant Atari. The upper dash
material is a rewardingly thick textured urethane. The bottom half of the dash is
imported straight from Playskool. The front seats are spacious and comfortable;
the rear cabin should be on Eric Holder’s cruel-and-unusual list. The contents of
this box are in many ways more persuasive than the box itself.
How’s the Fiesta drive? Well, for starters, the powertrain refinement is
excellent, the best in the class. The Nissan Versa sounds like a mandolin in a
blender compared to Fiesta. The Ford can get a little tinny and loud under
pressure—despite a lot of sound-abatement materials—but around town the
Fiesta’s cabin is notably plush.
The Ford’s chassis layout is unremarkable—twist-beam rear axle and
Macpherson struts up front—but it’s clear from a few brisk turns on Mulholland
that Ford tried very hard to keep this a European-feeling small car—stiffly
sprung, lively, reactive, more about corners than straightaways. The electric
steering is alert, though not really all that communicative. Stability control is
standard.
Obviously, with 120 hp and 112 pound-feet of torque on board, you’re not going
to see God or anything. If you flat-foot the gas pedal, the PowerShift six-speed
automatic will snap through the ratios just fine—figure nine seconds to 60 mph.
But in hard, corner-to-corner maneuvering the gearbox can get a little confused
and hesitate. The cars are equipped with a kind of gear-holding feature—a “hill
descent” button that will lock out overdrive—but I would love to know why there
is no paddle-shifter on this car, as there is on the Fit.
My biggest complaint is with Ford’s choice of tires. The 16-inch Hankook radials
on my test car were noisy, grip-less junk. Put a decent set of sneakers on this car
and the handling would be transformed.
A whale of a car packed in a sardine can, the Ford Fiesta is now among the three
super-cheap new cars I routinely recommend, the others being the Suzuki SX4
hatchback and the Honda Fit, with its cool flexible cargo capacity. It’s an open
question whether Americans have been somehow harmonized, but the Fiesta is
ready to teach them a different tune.
Corrections & Amplifications
The bare-bones model of the 2011 Ford Fiesta is known as the S Sedan. A
previous version of this column erroneously called it the S Coupe. Also, the topof-the-line model is the SES Hatch. The column incorrectly called it the SES
Coupe.
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2011 Ford Fiesta SES Five-Door: Small Wonder | Rumble Seat by Dan Neil – WSJ
RUMBLINGS
2011 FORD FIESTA SES FIVE-DOOR
Base price: $17,120
Price as tested: $18,200 (est.)
Powertrain: 1.6-liter DOHC inline four with variable valve timing;
six-speed-dual-clutch automatic transmission; front-wheel drive
FORD
Horsepower/torque: 120 at 6,350 rpm/112 pound-feet at 5,000 rpm; 0-60
mph <10 seconds Length/weight: 160.1 inches/2,575 pounds Wheelbase: 98 inches Cargo capacity: 14 cubic feet (est.) EPA fuel economy: 30/40 mpg, city/highway A Super 'B' The precise alchemy of the Fiesta is B-segment size and economy, plus development costs amortized world-wide, plus as much U.S.-specific content and amenities as the project directors could sneak by the bean counters. As Bob Barker might have said, the price is righteous. European Stay-cation If you've ever rented a small American-brand car overseas and thought, "Why can't we get this back in the States?" Well, you just did. New Cosmopolitanism If the Fiesta succeeds, it will suggest that American car culture has moved toward a global consensus of small fuel-efficient cars. Small world after all. Cue the mouse. https://www.wsj.com/news/articles/SB10001424052748704370704575228112106450630?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB1… 4/5 6/17/2017 2011 Ford Fiesta SES Five-Door: Small Wonder | Rumble Seat by Dan Neil - WSJ Copyright ©;2017 Dow Jones &; Company, Inc. All Rights Reserved This copy is for your personal, non­commercial use only. To order presentation­ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. https://www.wsj.com/news/articles/SB10001424052748704370704575228112106450630?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB1… 5/5 1. What problem(s) facing consumers was Ford trying to solve by introducing the Ford Fiesta in the U.S.? 2. Did Ford create a product that met consumer needs? 3. Calculate the total cost for the Fiesta program in the U.S. as described below: 1. Record how much Lenard's team invested in manufacturing the cars and infrastructure for the U.S. launch. 2. Record the budget spent per month to maintain the Fiesta program. 3. Record the number of months the program was maintained. 4. Calculate the above to create the total cost 5. Now take the total cost and divide it by the retail price to determine how many cars need to be sold to recoup the investment. ... Purchase answer to see full attachment

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