Full text of Ford CEO Mark Fields’ keynote at Mobile World Congress 2016 in Barcelona on February 22, 2016.
Listen to the MP3 Audio here: MP3- Ford CEO, Mark Fields Keynote at Mobile World Congress 2016
Announcer: I’m absolutely delighted to introduce to the stage Ford President and CEO Mr. Mark Fields.
Mark Fields – Ford President and CEO
Well, it’s great to be here at the 2016 Mobile World Congress. And if you think about it, Mobile World Congress and Ford have a very special history, because five years ago we were the first automaker to reveal a vehicle at this show and we also announced Ford SYNC – which is our in-car connectivity technology – was coming to Europe. Bill Ford also stood right here on this stage and surprised the audience when he said that Ford was beginning to fundamentally rethink transportation — and he laid out our Blueprint for Mobility.
And last year here, we introduced Ford Smart Mobility — our plan to reshape the future of transportation and change the way the world moves just like Henry Ford did more than a century ago. Ford Smart Mobility is our plan to be a leader in connectivity, mobility, autonomous vehicles, customer experience, and data and analytics. And last year here, we also introduced two new e-bikes which are part of more than 30 global mobility experiments for studying how to help people move more easily through cities.
And today we’ll share our next steps as we at Ford take on one of the most significant strategic shifts in our company’s 113 year old history as we expand our business from being an auto company to an auto and a mobility company.
Now for us this shift was driven by our changing world, which is becoming more crowded and more urbanized. Air quality is a very serious issue and customer attitudes and priorities are changing rapidly. So consider this: Europe already is one of the most urban regions in the world with 73% of the population living in cities and the numbers continue to climb even in mature cities and in regions.
Take Barcelona. Here Barcelona is already the sixth most populous urban city center here in Europe and is expected to grow another 17% more to more than 5.5 million people by the year 2030. And as a result of course congestion and gridlock are on the rise and consumers are really feeling it.
Research indicates that the majority of people in Europe feel commuting can actually be more stressful than their daily jobs. And listen to this quote: “My smartphone is my preferred mode of transport” and that’s from Patrick McLoughlin who is the UK’s Secretary of State for Transportation. So people keep talking about how the auto industry needs to change to avoid being disrupted by the tech companies.
Well, at Ford, we decided to disrupt ourselves by expanding our business model. First, we are further growing our core business which is all around designing, manufacturing, marketing, servicing and financing great cars, SUVs, trucks and also electrified vehicles. But at the same time we’re aggressively pursuing emerging opportunities through Ford Smart Mobility and becoming part of transportation services to meet customer needs and become part of a huge revenue stream.
Think about this: The traditional global auto industry generates about $2.3 trillion in revenue each year. And today at Ford we get about 6% of that. At the same time, transportation services which include things like mass transit, taxis and ride sharing totals about $5.4 trillion in revenue, an amount that’s expected to grow steadily in the next 15 years. Yet today, Ford and automotive competitors get virtually none of this business and that is a massive opportunity and it’s the reason we’re expanding our business model and our customer offerings.
And we’re doing this from a position of strength. Ford last year delivered record profits and grew our global market share due to the strength of our new products. We were America’s best-selling vehicle for the sixth straight year in a row and here in Europe we grew our market share last year, the second year in a row, and we became Europe’s top commercial vehicle brand. From the Fiesta small car to the Mustang sports car to our bestselling trucks and SUVs, our product strength continues to gain momentum, and that includes seven new or upgraded vehicles that we’re introducing here in Europe this year alone, including the new Kuga which is making its world debut right here at the Mobile World Congress.
Kuga is a thoroughly modern SUV for today’s world. It’s connected, it’s intuitive, it’s more fuel-efficient and it’s packed with semi autonomous technologies like automatic braking and parking, and perhaps most importantly, at a mobile technology conference, it comes with SYNC 3, the most advanced version of our popular in-car connectivity system, which I’ll talk more about in a moment.
Now Kuga is already extremely popular. In fact, last year was Kuga’s best ever sales year in Europe since it was introduced. And you can see the new Kuga which is built right here in Spain on our stand in Hall 3 here today and we encourage you to go check it out.
Products like Kuga with SYNC 3 are just one example of how serious we are of being an auto and mobility company. Transportation we feel is on the cusp of a revolution and it’s inspiring a revolution at Ford. To us, mobility is about giving people the freedom to live to work and to play where they want. And it’s about making people’s lives better by changing the way the world moves.
And today we’re proud to share more news tied to our progress in all five areas of Ford Smart Mobility. So let’s start with Connectivity.
Ford SYNC is the industry’s most popular in-vehicle entertainment and communication system, and right now there are more than 15 million SYNC equipped vehicles on the road globally. And by 2020, we expect more than 43 million vehicles will be on the road with SYNC, helping drivers stay connected on the move while keeping their hands on the wheel and their eyes on the road.
And today we’re announcing that our third-generation SYNC — SYNC 3 — is coming to Europe this year. It’s going to be debuting on Mondeo, S-MAX and Galaxy and of course the new Kuga. We’re also announcing that SYNC 3 will be compatible with both Android Auto and Apple Carplay giving users access to even more functionality via voice control or their touch screen.
SYNC 3 is more intuitive, it’s easier to use and even quicker than the previous generation. It also has an all new graphical interface that smartphone users will find familiar and can be updated over the air through a Wi-fi connection. SYNC 3 also features five new languages supporting a broad spectrum of European markets and more conversational speech recognition.
So just push a button and say “I need coffee” or “I need petrol” or “I need to park” and SYNC 3 will find the places that you need to go.
Today we’re also announcing at the same time five new AppLink partners in Europe — MyBoxMan, HearMeOut, AccuWeather, Cadena Ser and Los 40. And our AppLink platform and supporting developer program literally allows developers to develop apps directly for SYNC 3 giving our customers easy access to their services, information and entertainment. In fact, one of the partners – MyBoxMan – traces its origins to a hackathon that we organized just a few months ago at Web Summit in Dublin and MyBoxMan is a social shipping act – think about Uber for packages or for deliveries. So if you’re making a journey you can check the weather and you can check whether anyone in your area needs to get a package from where you are to where you’re going and in process, well, you get to make a little money.
Now let’s talk about Mobility. We’re seeing great results from our on-demand car sharing service that we launched in London last year which we call GoDrive. GoDrive is growing fast because of the flexibility it provides customers with a one-way trip availability, guaranteed parking and pay per minute pricing as opposed to the “by the hour” pricing of other services and we’ve expanded the program to 25 hubs across London, including major transport centers such as Waterloo Station and City Airport.
And as we’ve grown, we’ve gained important insights about what customers want in such a service. For example, almost half of GoDrive customers don’t own or have access to a car, which means that they don’t currently engage with Ford or buy our vehicles, and that means that GoDrive is bringing new people to Ford. Also, over 60% of GoDrive customers have chosen an electric vehicle at least once. And those who have, well, 97% of them say that they would use an electric vehicle again. And with such great success that we’re having with GoDrive, we’re now expanding our efforts to parking.
And today we’re announcing GoPark which is a new pilot program to make parking in cities easier and importantly less stressful for drivers. GoPark is a predictive parking system that can actually direct customers to a place where they’re most likely to find an open parking spot and a group of residents from the borough of Islington in the UK have volunteered to take part in the pilot. And with their permission we are equipping their vehicles with plug-in devices to collect data as they come and go from parking spaces in a defined area and by observing patterns and then combining that data with available city data and traffic and parking conditions, we’ll be able actually to predict available parking spots based on the time of day and location.
And the best part? Well, GoPark is open to everyone and you don’t have to be a Ford owner to participate in this.
Now let’s turn to autonomous vehicles, a subject of much discussion in our industry lately. And at Ford, we’ve been focused on autonomous vehicles for more than a decade and this year we’ll have the largest autonomous test fleet among all automakers. We have vehicles on the road today in Michigan and Arizona and we begin testing this year in California and we will be expanding even further in the future.
Now Ford’s autonomous vehicle program goal is delivering the Society of Automotive Engineers’ level 4 capability which is full autonomy in defined environments. This is the level that many of the technology companies are going for and this takes the driver completely out of the loop, which ultimately leads to level 5 which, is full autonomy in any location in any weather condition. And when the first Ford autonomous vehicle comes out it will be an autonomous vehicle designed to serve millions of customers, not just for those who buy luxury vehicles.
At the same time we’re also absolutely committed to serving millions of customers today with automated technology that can assist them in becoming better drivers. We already are a leader with semi autonomous and driver assist technologies. So on our vehicles today you can steer into a parallel or perpendicular parking spot, you can remain in your lane by alerting you or providing steering assistance, maintain a set speed and distance between vehicles on the highway, even in stop-and-go traffic and apply brakes if a collision is imminent.
And today we’re happy to announce that during the next five years we’re tripling our engineering investment in driver assist and semi autonomous vehicle technology and accelerating development and availability for our customers. This includes some new features like Traffic Jam Assist and Fully Active Park Assist. Traffic Jam Assist can relieve driver stress and enhance comfort by helping control of the acceleration, the braking and the steering during slow moving and stop-and-go traffic.
Fully Active Parking Assist will help drivers automatically pull into a parking spot by controlling the steering, the shifting and braking at the touch of a button. And we’ll introduce both of these features and more during the next three years. And again as we do this we promise that these technologies will be available on our highest volume products, delivering on our commitment as a company to serve millions of people and not just for those who can buy luxury vehicles.
So let’s turn to Data and Analytics, another important area. One of the ways that we’re learning about what customers will want and need in future mobility is by working actually with game developers. Last August we launched the Ford Smart Mobility Game Challenge at Gamescom in Cologne, Germany. We encouraged developers to create fun and engaging games that tackle the challenge of integrating different transport modes within a city. And we’ve been literally overwhelmed by the ideas that have come in and we’ll announce the winner here at the Mobile World Congress later this week.
Now as we make this transition to an auto and mobility company, there’s another very important part of our strategy and that’s about transforming the customer experience. This is influencing every part of our business from our core business of cars, SUVs and trucks to emerging opportunities and all of our Ford Smart Mobility work. And the opportunity here is literally huge.
Now traditionally we’ve dedicated most of our energy and for that matter of money to attracting new customers about a year before they actually buy a vehicle. And then we pretty much don’t engage them until their next purchase.
Well that’s about to change. Think about this: The average Ford owner spends about 900 hours a year inside of his or her car yet in that same year they spend on average only four and a half hours in our dealerships or interacting with our brand. And we absolutely know we need to engage customers differently going forward.
So during the past 18 months we’ve had a small group working secretly with customers and actually studying other companies that have transformed their customer experience focus. Companies like Nespresso and the clubs they create, or Rip Curl with wearables to actually recreate the surfing experience, and Nike with its digital ecosystem. We’ve also been working with anthropologists and sociologists and digital experts studying what consumers want even before they can express it. And the result is FordPass. Take a look.
So FordPass reimagines the entire customer experience and aims to do for the auto industry what iTunes did for the music industry. And think about FordPass as a digital, physical and personal mobility experience platform that includes four main parts: a Marketplace of mobility solutions, FordGuides who are always there to help, Appreciation where members are rewarded for their loyalty, and FordHubs where customers can experience our latest innovations. And we’re introducing FordPass in the UK and Germany and France later this year. Importantly anyone can become a member for free whether you own a Ford or not. Just by registering online. And like other platforms, FordPass will continuously grow and evolve and improve each year.
And today we’re pleased to share details of our first offerings here in Europe starting with marketplace. We’re announcing a new partnership with Mobile City for parking. We’re also announcing that in Germany — Europe’s largest car sharing market – that we’re strengthening our partnership with the car sharing company Flinkster.
The second element of FordPass is FordGuides. These are real people who provide real-time mobility solutions, 24/7, including reserving and paying for your parking ahead of time. And the guides are available free of charge and their only job is to serve, guide and solve and not to sell.
Moving on to Appreciation. We’re partnering with McDonald’s and 7-Eleven to provide FordPass members access to merchandise and unique experiences as rewards for parking, interacting with one of our Guides or paying for vehicle service at one of our dealerships. And today we’re announcing a new FordPass partner – BP.
So think about this, imagine a future where FordPass directs you to stop by a BP station near you because it knows that you’re running low on fuel and imagine that you never have to pull out your wallet when you fill up at a BP station. Because as a FordPass member you can fuel and pay for your gas through FordPass, while at the same time earning appreciation points that can later be redeemed for fuel or drink or some food. And we’re not just imagining this. These are the kind of opportunities that we’re pursuing with our partners for FordPass members.
And, finally, the Hubs. We are launching four Hubs around the world, including one in London. Now inside a Hub, you’ll be able to explore Ford’s latest innovations, learn about our mobility solutions and experience exclusive events. So from a customer standpoint great experiences like those that will be delivering with FordPass lead to long-term relationships. And from a business standpoint, well, it’ll drive greater loyalty, it’ll bring new customers into Ford and also accelerate Ford in becoming a serious player in mobility services.
And as we look into that future, it’s clear that we’re on the cusp of a mobility revolution. And I have to tell you the entire Ford team is committed to expanding as both an auto and mobility company. And we’re absolutely committed to providing great products and great experiences and we’re committed to making people’s lives better by changing the way the world moves just like our founder did 113 years ago, today.
Thank you very much.