Driverless Trucks at Ford: Cruising into a Compromised Brand Identity?

23 Pages Posted: 11 Feb 2019

See all articles by Rajkumar Venkatesan

Rajkumar Venkatesan

University of Virginia - Darden School of Business

Jenny Craddock

University of Virginia - Darden School of Business

Abstract

In the summer of 2018, iconic American automaker Ford Motor Company (Ford) created a new limited liability company, Ford Autonomous Vehicles LLC (Ford AV), and charged the organization “with accelerating [Ford's] AV business to capitalize on market opportunities.” Alongside Ford's well-publicized push to debut robot-taxi and driverless delivery services in 2021 via the Ford AV unit, the company had also recently announced that it was retreating from the American car business and dropping several sedans in order to focus on its more lucrative line of trucks and SUVs, a move that was in line with Ford's long-standing reliance on the success of its trucks division, especially the F-Series, which the company first released in 1948. As the management team at Ford AV assumed their new roles and looked ahead to the not-so-distant future of autonomous vehicles at Ford, they wondered how they might incorporate self-driving technology into the F-Series lineup. In the case, the reader is presented with the driverless technology strategies of many of Ford's competitors in both the tech and automotive industry, and faced with developing a strategy around a potential autonomous F-150 pickup truck at Ford. Could an autonomous F-150 pickup make sense for the company? On one hand, delaying the decision could put Ford behind the curve. On the other hand, the F-Series brand buoyed its consumers' sense of independence and control, and aligning the F-Series to autonomous vehicle technology too soon might erode consumers' loyalty.

Excerpt

UVA-M-0967

Jan. 31, 2019

Driverless Trucks at Ford:

Cruising into a Compromised Brand Identity?

In the summer of 2018, iconic American automaker Ford Motor Company (Ford) created a new limited liability company, Ford Autonomous Vehicles LLC (Ford AV). Ford charged the organization “with accelerating [Ford's] AV business to capitalize on market opportunities.” As the newly appointed management team at Ford AV considered the best way to guide Ford, the second-largest automaker in the United States, toward its well-publicized robot-taxi and driverless delivery services slated to debut in 2021, they had several important decisions to make regarding the company's strategy and driverless car product offerings of the future.

Alongside its goals in the self-driving space, Ford had made a seminal product decision several months earlier, when the company announced it was retreating from the American car business and dropping several sedans, such as the Fusion, Fiesta, and Taurus (while preserving the Mustang and Focus Active crossover launching in 2019), in order to improve its profit margin. The company's decision to turn away from its slow-selling car models and instead focus on its more lucrative line of trucks and SUVs was in line with Ford's long-standing reliance on the success of its trucks division, especially the F-Series (which included the classic F-150 pickup truck and “super duty” F-250 and -350 trucks) that the company had first released in 1948.

. . .

Keywords: marketing, strategy, Ford, self-driving cars, autonomous vehicles, F-Series, F-150, brand loyalty, advertising, product placement, brand associations

Suggested Citation

Venkatesan, Rajkumar and Craddock, Jenny, Driverless Trucks at Ford: Cruising into a Compromised Brand Identity?. Darden Case No. UVA-M-0967. Available at SSRN: https://ssrn.com/abstract=3331362

Rajkumar Venkatesan (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

HOME PAGE: http://www.darden.virginia.edu/html/direc_detail.aspx?styleid=2&id=5808

Jenny Craddock

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

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