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Down the Road, Henry Ford Ii Sees Lighter Cars, New Engines and More Expensive Gasoline

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For Henry Ford II It was a week to remember. First, the 59-year-old chief executive officer of Ford Motor Co. announced that he was setting up a triumvirate, composed of himself, President Lee A. Iacocca, 52, and vice-president Philip Caldwell, 57, to run the world’s second largest motor company. Ford said it was “not a plan for immediate succession,” but it clearly pointed to the day when, for the first time in the company’s 74-year history, a Ford would not be in the driver’s seat. He then moved on to the gala opening of his pet project, the towering $337.5 million Renaissance Center, aimed at revitalizing downtown Detroit. Ford discussed it, the future of his company, the energy crunch and the role of the auto with Julie Greenwalt of PEOPLE.

President Carter has put the heat on Detroit to get rid of big cars. What role do you see autos playing in the energy equation?

First, I do think we have an energy problem, and the President is correct in facing up to that problem. It’s very easy to get at the automobile, but we’re not the total problem; automobiles account for only 30 percent of oil consumption. They’ve got to think of the automobile as a system. They can’t require emission controls and then expect fuel economy, because one defeats the other.

What about increasing the gas tax?

I suggested that to President Johnson and to President Ford. We pay far less for gasoline here than in most parts of the world. But I don’t suppose it’s a very popular political way to go.

What about a new emissions law?

Congress hasn’t settled on it yet, but I’m sure it’s going to be tough. If we don’t get an extension until 1979, we’re in trouble. The government has already passed a fuel economy law which says we have to get to 27.5 miles per gallon on the average by 1985. That’s a big problem for us—a big problem which we will accomplish.

Has the auto industry opened up new areas of technology that may help?

We’re developing in lots of areas. We have several new engines under development, some close in, some far out. One of them is the Stirling cycle engine. It won’t be available until the mid or late ’80s, but it doesn’t use gasoline. It can run on kerosene.

Will the auto industry have to sell consumers on smaller cars?

If we’re going to meet the fuel economy laws, which we’ve got to, the objective answer is yes.

How much will it cost to meet stricter federal regulations?

It’s going to cost the car buyer $200 to $400 more—depending on the emission laws. And it’s going to cost a lot of capital investment. Ford is going to spend about $8 billion in North America between now and 1980. None of it will get us any greater productivity or a greater share of the market. This is $8 billion to meet the emission laws, the safety laws, the fuel economy laws.

To a casual observer, government regulations sometimes seem a bit confusing and contradictory.

Come sit in our office if you want to be confused! It’s a monstrous problem, because it involves so many things. I just hope they keep the automobile in perspective and think about employment. The automobile industry, with all its ramifications, contributes about one-sixth of the gross national product.

What do you see as your foremost problem area ahead?

To meet all these laws and still have a product that the consumer wants and can afford to pay for. Who knows what will happen in the marketplace? There may be an uprising. People may say, well, we aren’t going to buy. And that will affect everybody. I don’t think you can legislate what the consumer wants.

How will cars change?

I’ve always maintained that automobiles change in an evolutionary manner, not revolutionary. We’ll be driving smaller cars, and they are going to be a lot different under the hood but won’t look an awful lot different. I think Americans will keep their cars longer. But what’s really changing is in the marketplace. People are giving up cars for other kinds of transportation—four-wheel-drive Jeeps or Blazers. They’re giving up station wagons for pickup trucks and putting tops on them. Or big vans where they install an icebox, AM-FM radio, waterbeds and carpet up to the ceiling. They’re going into something they can personalize.

Five years ago you introduced your plans for revitalizing Detroit. Now Renaissance Center is officially opened. How did it come about?

We started a long time back. Detroit’s central business district was becoming like the hole of a doughnut. We were then talking about building in the suburbs, and one fellow said I was doing a lot to help business leave downtown Detroit. And then this black fellow came in, and he said, “You’re not doing anything for the blacks. Sure, you’re hiring at the Rouge plant, but most blacks live in Detroit, and it’s just falling apart.”

So what did you do?

There was all this vacant property on the riverfront. So we got together a consortium of 51 companies to build Renaissance Center on a private basis. It wasn’t the answer to all the problems. Basically, it was a catalyst to excite other people to do something downtown.

Was there “arm-twisting”?

Well, I tell you, you don’t twist big corporations’ arms! Whether it was General Motors or Chrysler or American Motors or any of the suppliers and tire companies, they all came in voluntarily and as they saw fit. They felt they had a responsibility to the city of Detroit.

How do you answer criticism that Renaissance Center is a fortress, a city-within-a-city?

I was a little apprehensive about those berms [concrete abutments] looking like a wall to keep people out, but I think the place is open enough. It’s bringing more people downtown. The University of Detroit spent about $7 million on their property around Renaissance Center, lots of little houses have been redone and even new restaurants have opened. It’s a good start, and I’m very pleased.

What more must be done?

Basically, we need more housing downtown—lower-middle-and upper-income housing. There are a lot of new things coming. Crime is down. Detroit recently went for a period without any murders, and that was a big change.

Is the Ford Motor Co. starting a trend by bringing employees back to the city?

I hope so. Since some of our people are moving down here, we showed them around the area. They live out in Dearborn, they work in Dearborn, and I couldn’t believe it—some of them hadn’t even seen Cobo convention hall [built in 1960]. They hardly knew it existed, except what they’d read about it. I was just dumbfounded!

You have just announced that two Ford executives will share the leadership with you. How long will you remain as chairman?

Health permitting, I think I’ll stay on as chairman until I’m 65.

You were hospitalized last year for angina. How is your health now?

Pretty good. I never exercised regularly in my life until I had this problem with my artery. So now I’m taking up exercise—and that means nothing except riding a stationary bike. That’s pretty good, because you can get a lot of exercise without going anywhere—and you can listen to the radio. That’s what I do every morning religiously. It’s a great help. I don’t think I’ve lost any weight, even a pound, but it looks redistributed, maybe.

Is there a chance another Ford would succeed you?

Well, wait a minute! We’ve got five years to do a lot of thinking about that. I do think it’s important that somebody by the name of Ford be in the top echelon, not necessarily as chief executive officer but in the very top area.

Your son Edsel is now 28. How is he doing with the corporation?

He’s doing fine, very well. He says he likes this work.

Someone said his dad must not like having Edsel around—he keeps sending him all over the country.

Well [chuckle], that’s to give him some experience. He can get it better out in the field than around here.

Would your daughters be interested in working for the corporation?

I doubt it, but who knows? I don’t have any idea because they’ve never told me.

Why did you support Carter in 1976?

I thought he’d be a good President, and I think he’s turned out to be a good President. I think his appointees are very good. The economy is going forward now.

Do you have any advice for President Carter?

Yes, I do. I’d like to see him worry about controlling inflation, because that affects all the consumers. It shocks everybody when they look at their fuel bill, coffee or whatever. I would be very happy to see him think about inflation as the primary problem that has to be worked on and controlled to the best ability of the government.