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The Strange Ford Initiative That Could Take On Silicon Valley

By John Rosevear - Jan 21, 2016 at 6:10PM

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Last week, Ford announced FordPass, a cluster of free services that doesn't seem to make a lot of sense -- at least, not yet. But it might be the basis for a big transformation of the Blue Oval over the next few years.

Ford CEO Mark Fields unveiled the new FordPass service in Detroit last week. Image source: Ford Motor Company.

Ford (F 2.21%) recently announced a new initiative called FordPass. Set to launch in April, the company said that FordPass "reimagines the relationship between automaker and consumer."

But what is it?

A cluster of services that don't make a lot of sense -- at first glance
First of all, when it launches this spring, it will be a free service that's available to anyone willing to register online, whether they own a Ford vehicle or not.

As to what the service includes, that's a little fuzzy. Here's what Ford has told us about the benefits of FordPass so far:

  • FordPass Marketplace will give FordPass members "access to mobility services." For the moment, that seems to include services to help find and pay for parking in certain cities, and a partnership with airport ride-sharing service FlightCar. Members will also be able to quickly make appointments with their preferred dealers, check their Ford Credit loan details, and pay for services via FordPay, a virtual wallet.
  • FordGuides are a kind of concierge service, available to help members make use of FordPass services. Ford emphasized that the guides have no sales responsibilities; they're simply trained to help.
  • FordPass Appreciation is a rewards program, offering members "access to merchandise and unique experiences." Ford said that the partners include "McDonald's, 7-Eleven, and others," with presumably more to come.
  • FordHubs will be little stores in which consumers will be able to learn more about Ford and its services and "experience exclusive events." Executives made no secret of the fact that idea was inspired by Apple's retail stores. The first FordHub will open in New York City later this year, and it will be followed by others in San Francisco, London, and Shanghai.

An artist's rendering of a future FordHub store. Image source: Ford Motor Company.

What Ford's CEO says this is really about
So what's this thing really about?

"We want our relationship with customers to be as strong as our products," CEO Mark Fields told me when I put the question to him last week. "Our industry tends to focus on the initial purchase and developing that relation and then for the most part doesn't engage [the consumer] until the next time the customer is in the market.

"Think about what Apple did for the music industry. They had the iPod, which was great. Then they came out with iTunes. They married the hardware with a customer experience that changed the game for the customers and provided a great business opportunity for Apple. So just as iTunes revolutionized the customer experience in the music industry, we want FordPass to do for automotive ownership and relationships."

Fields emphasized that this is a long-term project for Ford, and that the company will build on its suite of services over time.

He didn't quite come out and say it in this way, but I got the sense that FordPass is intended to be the foundation for Ford's answer to the Silicon Valley giants that want to "disrupt" the traditional automakers.

"Mobility services" is the key to FordPass
Rival General Motors (GM 2.65%) on Thursday announced a new Zipcar-like car-sharing service called Maven. I think Maven will eventually serve as the basis for a GM "mobility service" that combines the systems built by GM partner Lyft with GM's own driverless-car and electric-vehicle efforts. In other words, an automated competitor to companies like Uber (and like the car service that Apple may well be developing).

Right now, FordPass is a little more nebulous than GM's Maven. But I think Ford is thinking along essentially the same lines. Fields and other Ford executives have been talking for a while about transforming Ford into a "provider of personal mobility." I think FordPass will evolve into a key part of that transformation.

John Rosevear owns shares of Apple, Ford, and General Motors. The Motley Fool owns shares of and recommends Apple. The Motley Fool recommends Ford and General Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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