The Innovator’s Dilemma — Ford Edition

Redtail Loop Trail, Palo Alto, CA

Henry Ford revolutionized mass production democratizing mobility as we know it today. Since that, Ford has survived GM’s supply chain innovation & Toyota’s lean production innovation. Now, how could Ford enter the renaissance in the age of the smarter car? Tesla vs Model T & Tesla Production

Smarter trucks

Ford continues to lead the pack of trucks. For example, F-150 has been the best-selling car in North America for a while. Because of the rise of the suburbs, Americans love their pickups for good utility reasons. And, Americans may love it even more as people have been moving toward the suburbs before Covid. Even more so, as working remotely become a new norm. Now, there may be a great window of opportunity for Ford to lead the next wave as Tesla has better things to do than launching Cybertruck in 2022. So, how may Ford make the “mini-mill” disruption on the smarter truck section?

Statista: U.S. vehicle sales, by vehicle type(in 1,000 units)

Digital Transformation

In 2021, Ford & Google joined the force to transform the auto industry. Kudos to Ford as the first incumbent fundamentally embraces new computation paradigm shifts & the power of partnership. It’s not easy as history keeps rhyming. Most incumbents are too proud of their current success till a disruption is overdue. Which can lead them to the path of “the Nokia of the smartphone” sooner or later.

For the most EV HW innovations, I bet key carmakers can catch up quickly. Some even argue, they will beat Tesla on the “build quality”. However, SW differentiators are much more difficult to catch up with, and the dynamic range can be huge. I can not agree more with Ford CEO Jim Farley on that, the half of Ford’s future business may come from connected services.

This is even more important for truck owners as the trucks are their offices on wheels. Just imagine how much more productivity to be unleashed as those mobile offices is “Internet native”. This is something easier said than done for sure. Still, kudos to Ford to make up its mind to try earlier rather than later.

In may opinion, Ford will have a better chance to develop disruptive technology by focusing on the “right” customers first to cross the chasm faster. Rather than the majority of current customers. The “right” customers are typically innovators & early adopters. Who may really appreciate “data as the new oil”, and will invest to take full advantages of information technology. So, they may up-level their productivity or be entertained better.

UnfoldLabs: Automobile Data: Sources, Collection & Goals

Product-Led or Promotion-Led Growth

There are two types of PLG. Typically at the early stage of disruption, Product-Led Growth is much more important. Therefore, iPhone disturbed feature phones, and Tesla disrupted EV. On the other hand, Promotion-Led Growth is increasingly important from a tipping point as the technology & market mature. It even becomes the only way to complete in a commonality market. That’s why Coca-Cola spends more than $4B on ads each year to sell “sugar-water”. And so do Ford, Toyota, GM. They have to spend much more on marketing. Whereas Tesla spends very little on that.

However, snowboarding runs will be very different from the skiing moves that Ford is good at, as Farley put it with a recent bet for a $20B reorganization. It’s smart to set up an autonomous product focus organization. So, they can be rewarded with small wins, and focus on smaller customer sets to push the boundaries & move faster. Godspeed, Ford & all brave innovators.

Comparing Tesla’s Spending on R&D and Marketing Per Car to Other Automakers

Full Disclosure

The opinions stated here are my own, not those of my company. They are mostly extrapolations from public information. I don’t have insider knowledge of those companies, nor a whatever expert.



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Sam Lin

A Taiwanese lives in Silicon Valley since 2014 & has random opinions on some stuff. The opinions shared here are my own, not those of companies I work for.