Transcript JD Power and Associates 2010 Initial Quality Study Ford`s

THE QUALITY JOURNEY OF
FORD
Adrian Vido
Ford Motor Company
Director, Global Manufacturing Quality
Where we were…below industry
Lexus
Cadillac
Jaguar
Honda
Buick
Mercury
Hyundai
Infiniti
Toyota
Mercedes-Benz
Audi
BMW
Oldsmobile
Volvo
Acura
Chevrolet
INDUSTRY AVG
Chrysler
Dodge
Lincoln
Pontiac
Subaru
GMC
Ford
Mitsubishi
Saab
Jeep
MINI
Land Rover
Saturn
Suzuki
Kia
Nissan
Mazda
Scion
Porsche
Volkswagen
Hummer
J.D. Power and Associates
2004 Initial Quality Study
Problems Per 100 Vehicles
Ford ranks 23rd
VIEW FROM THE BOTTOM:
BELOW AVERAGE
QUALITY THREATENED
FORD’S FUTURE
How below average quality hurt Ford….
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Unsatisfied customers
Lost sales and market share
Lower resale values
Poor reputation
Loss of credibility/trust
Higher warranty costs
Low employee morale
Ford’s quality offensive plan….
Design in Quality
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Standard global process
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Global Product DNA: looks, sounds, feels like a Ford
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Don’t compromise customer wants for lower cost
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Verify designs further upstream through virtual tools
Build in Quality
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Read every claim, every day; address in 24 hours
Virtual manufacturing to reduce worker
injury/strain
Each assembly function (body, paint, etc.) has a
dedicated team of problem-solvers
People Quality
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Developing a critical mass of problem solvers
Ford has trained over 90,000 Green Belts, over 9,000 Black Belts and over 500 Master
Black Belts worldwide
Ford has over 900 technical specialists
The Road Back….
Ford #1 mainstream brand
J.D. Power Initial Quality Study
2010
2009
Ford launches a new,
stricter global quality
standard
Ford’s quality ranks below
industry average
Global Product
Development System
launched;
quality built-in
2003
early
2008
Consumer Reports 2009
Annual Auto Issue
2007
J.D. Power Initial Quality Study
Ford achieves initial quality that’s equal to Toyota
and Honda—the tipping point
RDA’s Global Quality Research Survey
2006
2500
2354
FLM Total TGW Trend
2340
2250
1980
2000
1920
1960
1837
1750
2002
1563
1500
Things-gone-wrong
per 1,000 vehicles
Then: 2,350
Now: 1,100 in 2009
Ford: “World-Class
Reliability”; 90% of
line-up average or
better reliability
1395
1250
1287
1206
1000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
GQRS CUSTOMER SATISFACTION US FLM
Satisfaction with Overall Quality
90
better
85
80
75
70
Industry Improvement = 0%
83
82
81
82
82
82
82 FLM
82 VW/Audi
81 Honda/Acura
80 New GM
77 Hyundai/Kia
76 Toyota/Lexus/Scion
75 Nissan/Infiniti
75
74
73
73
72
73 Chrysler LLC
72
70
71
67
65
2005
2006
2007
2008
2009
2010
FLM ranks 1st in Satisfaction, improving by 2 pct. Pts.
GM Satisfaction improves 3 pct. pts. over last year, reaching 80%.
GQRS TGW/1000 US FLM
better
2150
TGW/1000 Trend
2041
1926
1900 1837
1836
1771
1650 1659
1561
1548
Industry Improvement = 1.9%
1749
1659
1625
1400
1396
1334
1241
1150
1206
1554 Chrysler LLC
1487 VW/Audi
1438 Hyundai/Kia
1316 Nissan/Infiniti
1289 Toyota/Lexus/Scion
1190 New GM
1140 FLM
1113 Honda/Acura
900
2005
2006
2007
2008
2009
2010
FLM TGW continue to improve (5.5%), but does not keep pace with Honda’s
improvement rate (8.6%).
FLM gives up its first place ranking but remains statistically equivalent to Honda at
95% confidence level.
Where we are today….#1 full-line brand
J.D. Power and Associates
2010 Initial Quality Study
Problems Per 100 Vehicles
Ford #1
Mainstream
Brand
Benefits of having industry-leading quality….
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Customer satisfaction – 82% customer satisfaction**
Increased dealer showroom traffic
Higher U.S. sales – 20% jump in 2010
U.S. market share growth – up 16% in 2010
Better resale values – highest avg. auction value*
Improved credibility and reputation
Fewer warranty repairs – 40% lower globally v.s. 2009
Boosts employee morale
*Data Source: Vehicles 1-5 YIS, NADA AuctionNet May CYTD, Mileage and Mix Controlled, Luxury Brands Excluded
**Data Source: J.D. Power and Associates 2010 Initial Quality Study
Ford’s Quality Strategy
 Improve our Product by identifying customer satisfaction
opportunities with leading designs
 Standardize and adhere to key quality Processes in Manufacturing,
New Model Programs, and Product Development
 Develop our People by building a world class quality organization
with advanced problem-solving knowledge for improving quality
and productivity
 Improve our Perception by delivering and communicating proof
points to stakeholders
Commitment To Innovation And Quality Excellence: Continuous Improvement For Life
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