New York Auto Show: Ford's Smarter Moves on Display

(MoneyWatch)  NEW YORK--By thinking small (not to mention thinking ahead), Ford has a big advantage as it tries to recover from the worst recession to hit Detroit in recent memory.

As the U.S. auto market settles into the grim reality of less than 10 million cars a year for the foreseeable future, only Ford among the Big Three seems able to ride the storm without government assistance. It is thus spared the embarrassment of having to get a viability plan approved.

Ford CEO Alan Mulally thought ahead by taking out $23 billion in loans in 2006, when it was still possible to access that kind of money. The cash is keeping Ford afloat as it continues to lose money ($14.6 billion in 2008, a 20 percent drop) only slightly ahead of GM (22 percent down) and Chrysler (a whopping 30). Ford's U.S. market share is 15 percent and steady.

At the New York International Auto Show, Chrysler Vice Chairman Jim Press rolled out in a tiny 500 from would-be merge partner Fiat. Chrysler has no great small car of its own, instead launching an out-of-time 2011 Jeep Grand Cherokee. GM's low-tech Project PUMA urban mobility pod (which zipped around the convention floor) was mostly built by its own partner, Segway.

But Ford was able to offer journalists rides in its very own Euro-derived Fiesta, which wrestles 40 mpg out of a 120 horsepower, 1.6-liter four-cylinder engine. This "world car" is already on sale in most markets, and it comes to the U.S. next year. It's an early success un Europe. The Fiesta will be neatly nestled next to another small world car, the Focus, which is all-new for 2010.

Ford has a $10 million Department of Energy grant to develop plug-in hybrids, and has one in the pipeline for 2012 (prototypes are based on the Escape). It is also developing an electric delivery van (2010) and a battery EV (Focus based, 2011). Nancy Gioia, Ford director of sustainable mobility technology, says electrification is "the next major shift" in passenger cars. If Henry Ford were still around, he'd probably agree.