A Portfolio Approach

In the very early years of our industry, automotive engineers experimented with a variety of methods for powering vehicles, including electricity and biofuels. The internal combustion engine using petroleum-based gasoline and diesel rose to the top fairly quickly, and has been the standard vehicle power source for the past 100 years. Reminiscent of those early years, we are now in a period of intense experimentation and adoption of new vehicle technologies and fuels. This time, however, there may be no single winner in the race for the vehicle of the future.

That is why Ford is taking a “portfolio approach” to developing sustainable technologies and alternative fuel options. Our goal is to provide diversity in fueling options, in order to meet customers’ differing needs, while improving vehicle energy efficiency and long-term sustainability. We are thus providing customers with a range of affordable, fuel-efficient vehicles, advanced powertrains and alternative-fueled vehicle options.

We also believe that traditional gasoline- and diesel-powered vehicles with internal combustion engines will continue to be a major part of the mix for quite some time. So we are working to improve the fuel efficiency of the engines and transmissions of our current vehicles, along with every vehicle subsystem. For example, we are introducing fuel-saving technologies like our EcoBoost™ engines and efficient six-speed transmissions across a wide range of our traditional gasoline vehicle lineup.

Most importantly, we are developing global vehicle platforms that are compatible with a wide range of fuels and powertrain technologies. This allows us to offer a portfolio of options to our customers, target options to regions where they make the most sense and evolve our vehicles as technologies and markets develop. Global platforms that have “plug-and-play” compatibility with a wide range of technologies will also allow us to make the range of fuel and powertrain options available more affordably. For example, in the next three years we will be introducing an all-electric Ford Focus, a next-generation hybrid electric Ford C-MAX, and the C-MAX Energi plug-in hybrid – all built on our global C-platform.

Also, we currently produce 17 flexible-fuel vehicle models across our global markets that can run on either regular gasoline or E85 (a blend of 85 percent ethanol and 15 percent gasoline). Though biofuels are not available in every market, they are widely available in the U.S. and South America, and in some parts of Europe, so it makes sense for us to provide this option to customers who can take advantage of it. In addition, biofuel availability is expected to increase globally. In Europe, the EU’s Renewable Energy Directive mandates that 10 percent of energy in the transportation sector must come from renewable fuels by 2020. In the U.S., the Renewable Fuel Standard requires annual increases in the volume of renewable fuels, reaching 36 billion gallons by 2022. Ford’s flexible-fuel vehicles, which are provided at no or low additional cost, allow consumers to choose fuels based on availability and price.

We are also making engines that can be converted to run on compressed natural gas (CNG) and liquefied petroleum gas (LPG) available on select vehicle models. And, we are working with qualified vehicle modifiers to ensure that conversion to those fuels meets our quality, reliability and durability requirements. For example, we recently announced that the new Ford Transit Connect, which went on sale in the U.S. in early 2010, is available with a CNG/LPG conversion-ready engine package. Our F-Series trucks and E-Series vans are also available with a propane-ready engine. In Europe, we offer CNG and LPG conversions of various models in markets with a dedicated infrastructure, such as Italy, Germany and France.

CNG and LPG are particularly good options for fleet customers, such as taxi companies and delivery services, that use a central refueling system. In addition, CNG and LPG are widely available as vehicle fuels throughout South America and Europe. We are delivering CNG/LPG-ready engines to provide another lower-carbon option to those customers for whom this option makes sense.

As noted above, we are also developing a range of electrification technologies, including all-electric, hybrid electric and plug-in hybrid electric vehicles. Our vehicle electrification strategy is based on providing customers with a variety of vehicle choices to meet their driving needs. To read more about this strategy, please see Electrification: A Closer Look. All-electric and plug-in hybrid vehicles may initially make the most sense for urban drivers and fleet users who have daily commutes under 40 miles. However, as battery and recharging options continue to advance, we expect these vehicles to work for a wider range of our customers.

In the longer term, hydrogen may emerge as viable alternative fuel. Hydrogen has the potential to diversify our energy resources and lower lifecycle greenhouse gas emissions, if low-carbon hydrogen production becomes feasible. To prepare for this, we are developing technology to power vehicles with hydrogen fuel cells. In addition, we are working to pair hydrogen fuel cell technology with vehicle electrification technologies to maximize the sustainability benefits of both technologies.

This section describes our current actions and future plans to develop a wide range of energy-efficient technologies, alternative fuels and advanced powertrain technologies that will give our customers near-, mid- and longer-term options for more sustainable vehicles.