By on May 1, 2018

Ford recently announced the elimination of the traditional car from its North American lineup. Within two or three model years, no four-door Ford will be available with a trunk. No Fusion, no Focus, no Fiesta, no Taurus. The demand-driven logic behind the decision is clear. Cars have declined from 35 percent of Ford sales as recently as 2012, to 23 percent last year.

The company does not report profitability by nameplate, but we can safely assume their declining contribution to net income has been even more dramatic. So Ford’s decision was predictable, if seemingly dispassionate. Less predictably, a relatively healthy automaker is executing a long-term strategic shift. In public. Before the market forced it to.

Herein lies the real story.    

In the 1960’s Ford, along with other domestic automakers, ignored the fuel-sipping competition. In the 1970’s, again in lock step with its Detroit-based brethren, Ford reluctantly responded to rising demand for fuel-conscious vehicles with one unibody hatchback. OPEC eased up and so did Ford.

In the 1980’s the cycle repeated. But this time the Japanese manufacturers were here to stay and the domestics responded with somewhat more endearing fuel-conscious products. The consistent thread connecting generations in Detroit has been their unwillingness to read the trends and put the customer first. Examples abound, from their unwillingness to offer fuel-efficient vehicles, to resistance to seat belts and collapsible steering wheels, to disinterest in emissions reductions. Historically, automakers have altered their behavior only after the inexorable pressure of market forces or following a losing regulatory battle.

Against this background of hubris, Ford has emerged as a modern customer-focused enterprise, wise enough to make a multi-billion-dollar pivot, and confident enough to share its decision publically. Dearborn has been net income positive for nine consecutive years and generated $7.6 billion in net income last year. This is not a desperate company search of a path forward. And while the wisdom of eviscerating its North American car offerings is up for debate, its enduring focus on building cars and trucks that people want, and value is laudable. Ford is no longer a market maker, few if any automakers are. The difference is that Ford’s leadership understands this and has taken decisive action.

This decision will generate negative repercussions over the next decade or more. For example, what about Ford’s ability to attract first-time buyers? What if fuel prices spike unexpectedly? What about consumers who genuinely prefer a car? No strategic decision comes without risk. But resources are not boundless, and difficult decisions must be made. So, what if customers in the compact and midsize segments do not show loyalty at rates similar to buyers in other segments? What if a 25 or even a 50 percent increase in fuel prices does not significantly alter consumer behavior? We can be certain Ford has evaluated these questions and balanced the risks.

Perhaps most important, what if customers continue to pile into the significantly more profitable truck, SUV, and crossover segments but Ford has divided its investments across too many segments and lost its competitive advantage? These are the profitable sectors in the industry. They presently fund everything else the domestic manufacturers do. A financially fit Ford with competitive products in the hottest segments can continue to monitor trends and move with them. A Blue Oval with excellent products consumers don’t value will shed profitability and lose the ability to make forward-looking strategic investment decisions. A fading company becomes reactive and overly reliant on a small number of products (see FCA).

And let’s not lose sight of other another market force at work. Autonomous electrified transportation is around the corner. Automakers cannot afford to build product ranges that fight yesterday’s battles, they must look ahead. Today’s market entry point may not be tomorrow’s. A Fiesta or Focus may be replaced by a subscription. We may not even recognize today’s version of auto ownership in a decade.

Today’s Ford is a healthy, confident, customer-focused, future-oriented organization. And that’s the way I’d like to see it remain.

[Image: Ford Motor Company]

Get the latest TTAC e-Newsletter!

Recommended

143 Comments on “The End of Ford Cars: What’s in It for Us...”


  • avatar
    PrincipalDan

    This sounds like it was written for the stockholders by the Board of Directors.

    It doesn’t sound like there’s ANYTHING in it for “US” as the collective enthusiast community.

    • 0 avatar
      tonycd

      I disagree, Dan. Those of us looking for a steal of a deal can now score on devalued Tauruses, Fusions, Fiestas and Foci now that their resale value will be instantly devastated (for a recent case study, see Chrysler 200).

      That’s one side effect of Ford’s visionary move: It just cratered the transaction price of every sedan it sells from now until it officially shuts them down.

      • 0 avatar
        28-Cars-Later

        I agree but… these aren’t the platforms you’re looking for.

        “It just cratered the transaction price of every sedan it sells from now until it officially shuts them down.”

        There is probably some kind of tax advantage here we’re missing for Ford’s leasing company. Didn’t TCJA have some provision for depreciating things in one year instead of five or something to this effect? Dal am I right?

        • 0 avatar
          DeadWeight

          Section 179 of IRC – has to be placed into service for work purposes (not personal transportation) for a minimum of 50% of its time, and only get full deduction if used for work purposes (hauling building materials for business purpose, not a$$es to school or even to work)

          “The Section 179 deduction and bonus deprecation deals are only available for an SUV, pickup, or van with a manufacturer’s gross vehicle weight rating (GVWR) above 6,000 pounds that is purchased (not leased).

          “Section 179 Deduction for Property, Equipment, & Vehicles

          By Crystalynn Shelton on February 2, 2018 | Accounting, Business Taxes | Comments (15)

          Under the Section 179 tax deduction, business owners can deduct up to $500K of qualifying property & equipment purchases for the 2017 tax year. It is often referred to as the “SUV tax loophole” or “Hummer deduction,” for its ability to quickly deduct vehicles purchases. For the 2018 tax year, Sec 179 deduction doubles to $1MM.”

          https://fitsmallbusiness.com/section-179-deduction/

          • 0 avatar
            28-Cars-Later

            Thanks for the detailed explanation.

            This will probably be a nice driver for pickup sales the way the old $25K SUV deductions for small business were in the early 2000s.

          • 0 avatar
            dal20402

            That’s useful for the buyers of Ford trucks, but not Ford itself.

            As a rule there’s no tax advantage in cratering the value of your own asset, the way Ford’s done with its current and future inventory of Fiesta/Focus/Fusion, unless the value was illusory anyway. The additional deductions/losses you’ll generate are usually just a fraction of the actual bottom-line impact.

            But that’s just general and the tax situations of large companies are always insanely complicated. Every company of Ford’s size has a large full-time tax team in house and an army of outside accountants considering these questions.

          • 0 avatar
            DeadWeight

            Dal, what?

            Any automaker, including Ford, is getting language boost selling Section 179 qualified vehicles as the above-the-line tax deduction (offsetting otherwise taxable profits) has now been accelerated to a full write-off over one year, versus the prior 5 year, 20% per year depreciation write-off.

            Also:

            “Expensing of property, plant and equipment

            Under old law, contactors had two provisions to take faster depreciation when it comes to their property and equipment purchases. One provision is section 179 immediate expensing, and the other is bonus depreciation. Under section 179, up to $510,000 of property and equipment (new or used) can be immediately expensed so long as total acquisitions do not exceed $2,030,000.

            In addition, contractors could take first year 50% bonus depreciation on new equipment purchases in 2017. Bonus depreciation was scheduled to start phasing out after 2017.

            Under the act, there will be 100% immediate expensing allowed for the cost of new or used qualified property (office and field equipment, heavy trucks, earth movers and cranes) acquired and placed in service after Sept. 27, 2017, and before Jan. 1, 2023.

            Additionally, the section 179 limit/phase-out will be increased to $1 million/$2.5 million for property placed in service after Dec. 31, 2017.”

            https://www.constructiondive.com/news/what-does-the-new-tax-reform-act-mean-for-construction-companies/518085/

            This is already juicing 6,000 pound+ GVW truck, van, etc sales.

      • 0 avatar
        SkookumFord

        “It just cratered the transaction price of every sedan it sells from now until it officially shuts them down.”

        Can someone explain why this happens? Wouldn’t the value of these cars go up because they aren’t making them anymore?

        • 0 avatar
          pdieten

          It becomes an issue of perception, where the product does not appear to be supported by its maker as a product with a long term future and will look outdated quickly. So dealers have an incentive to get them off the lot in a hurry.

          Ford’s cars are not prestige products. Nobody is out trying to grab a Fusion before they disappear. Most of the kind of people who buy Fusions will be just as happy with something else.

          • 0 avatar
            quickson

            I don’t see how it can crater their price if people driving any recent Ford sedan didn’t already do it.

        • 0 avatar
          28-Cars-Later

          Discontinued vehicles lose their values about 5-10% very quickly in the wholesale market. Many reasons why, warranties, willingness to loan, popularity, parts supply, ease of service etc.

      • 0 avatar
        jkross22

        Tony,

        The Chrysler 200 was the worst car in its class…. by far. It wasn’t a bad car by historic standards, but it was a piece of fecal matter vis a vis other modern cars.

        That’s why it didn’t sell and that’s why so many are still on lots.

        The Focus and Fusion specifically aren’t pieces of crap even when compared with their competitors. They’ll lose resale value as orphans, but they’re good cars.

        • 0 avatar
          28-Cars-Later

          I still think the 200s are too expensive on the block, I wanna say 12s last time I looked.

          So long as your Focus is a manual I’d say a great value.

    • 0 avatar

      Mustang.

  • avatar
    tonycd

    Whatever Ford is, it’s not “a healthy, confident, customer-focused, future-oriented organization…executing a long-term strategic shift…(b)efore the market forced it to.”

    It’s an American corporation jerking marionette-like to the strings yanked by its Wall Street and Ford family masters. It’s abandoning what history has proved is a valuable hedge against unexpected market shifts, so it can placate its shareholder masters by gorging on short-term pickup/SUV markups with the pleasing illusion that they will roll in forever – just like last time, until they didn’t.

    If you want to see how a “healthy, confident, future-oriented organization” executes a long-term strategy, look to the world’s #1 automaker: Toyota. The one who just made a massive investment to refurbish its midsize and compact sedans on a brand new platform, and the one whose sedans’ success just drove Ford’s unreliable and inferior models into oblivion.

    Oh, and speaking of a “long-term strategy,” I assume this article is part of VerticalScope’s strategy to keep selling Ford banner ads for the TTAC page. There’s no other plausible explanation for it.

    • 0 avatar
      gtem

      tony I’m inclined to agree in full.

      Shareholders: “make returns go higher, now!!”

      Ford: “Okay, watch this.”

    • 0 avatar
      Bazza

      Throw Hyundai into that mix as well. If launching a new luxury division based solely on sedans (Genesis G90/80/70) isn’t confident and ballsy, I don’t know what is. Kia had no reason to develop the Stinger but did it anyway. *That’s* what confidence looks like. If Ford thinks that their miserable Ecosport is going to cut it as the starting point for long-term customer relationships, they’re going to learn a very hard lesson.

    • 0 avatar
      Yankee

      Well put Tony. The only thing I would add is that Ford’s decision is at least partially an admission of defeat after it produced decades of junk that sold poorly and paled in comparison to the competition. Remember the launch of the 500 that was supposed to replace the aging Taurus that had dealers screaming that Ford foisted such a lackluster product on them? Ford’s solution: re-tool the name badge and call it a Taurus again! Brilliant.

    • 0 avatar
      sportyaccordy

      Please explain how and when Ford’s “history” provided as a hedge against market shifts. Ford’s first big hit was a crossover (yes, the Model T), and the only constant in Ford’s postwar history was the F-series pickup.

      This reflexive fever pitch has advanced to a full on manic shriek. Get it together guys.

      • 0 avatar
        tonycd

        “Please explain how and when Ford’s “history” provided a hedge against market shifts.”

        I’m asserting the exact opposite, Sporty. Ford’s recent history (and GM’s, and Chrysler’s) is that their excessive dependence on the fat margins of fat non-cars bit them in the arse when the price of gas spiked. The lesson Ford has learned from that catastrophe is that they’ve now doubled down on their previous mistake. The less-awful MPG of modern crossovers lessens the error, but it’s basically the same error.

    • 0 avatar
      Lou_BC

      “The one who just made a massive investment to refurbish its midsize and compact sedans on a brand new platform, and the one whose sedans’ success just drove Ford’s unreliable and inferior models into oblivion.”

      Makes sense for Toyota to update its car lineup when Ford and other companies are handing the market to them.

      • 0 avatar
        mike978

        The article is wrong. Ford is still spending R&D money on the Focus, but not selling it in the YS and losing volume over which to smoratise that continued investment. Second how hard is it to do R&D on one truck (F150 and all it’s interactions) and four SUV/Cuvs (Escape, Edge,Explorer and Expedition). Surely the can focus on more than six vehicles in the US (including the Mustang).

    • 0 avatar
      Big Al from Oz

      tonycd,
      Overall your comment makes sense. It’s not that I disagree but view the issues a little differently.

      I really can’t believe how people on TTAC totally ignore the effects of all the measures that promote large vehicle production in the US.

      This used to protect and offer the Big 3 a guaranteed profit. Now, it’s impacting production.

      Ford will not be as competitive as other manufacturers of small and mid size CUVs and SUVs. If Ford can’t compete with cars it will not be competitive with CUVs and SUVs.

      As the popularity rises of these types of vehicles so will competition.

      Ford will be left with pickups and the related pickup truck station wagons.

      I do believe the long term strategy is a restructure of the whole US automotive vehicle industry, from top to bottom.

      Ford is taking the easy way out. But this easy way out is short to medium term. The impact of dropping cars will come back and bite Ford, but Ford has no other option in the current structure of the US/Canadian vehicle market.

  • avatar
    HuskyHawk

    I think the message is clear. The car is an appliance. There are a handful of enthusiasts, but they are a dwindling group. The days of kids having car posters on their walls in high school is probably over. Cars were the thing at my HS in the 80’s. Nobody at my daughter’s HS gives them a second thought, as long as they have USB ports and can play music from their phone in the car.

    I wouldn’t assume that Ford will fail to produce cars with good MPG even after this. Vehicles like the Subaru Crosstrek, and I can imagine one based on the Focus, will do well. The only change here is a change in priorities. Ride height, AWD and storage capacity are valued above handling and acceleration. That’s the new world.

    • 0 avatar
      tonycd

      Husky, funny you should cite the Subaru Crosstrek as an example of SUVs proving you can maintain high gas mileage while jacking up a hatchback 3 inches as a style statement.

      It’s the ultimate proof that you can’t, as it officially loses 2-3 MPG on the highway (EPA estimates, difference depending on transmission choice) compared to the otherwise identical but lower-slung Subaru Impreza hatchback sedan.

      No matter how many TTAC posters type otherwise, aerodynamic drag is still a thing, and you simply can’t repeal the pesky laws of physics. Greater height and frontal area increase drag, requiring more energy to move the vehicle forward through the air. This is inarguable. And it means that, all other things being equal (that being the key proviso), SUVs cannot match the gas mileage of otherwise identical sedans. Ever. Full stop.

      This, in turn, means that any sudden economic cataclysm such as a Middle East war could instantly create a situation in U.S. showroom that will damage the marketability of any maker lacking sedans for at least 12 months. Not that there’s any reason to think such a far-fetched scenario could really happen – it’s not like there’s a U.S. president who just appointed a national security chief with a history of agitating successfully for an unjustified Middle East war that left 750,000 dead. Oh, wait. Sorry.

      • 0 avatar
        kvndoom

        The trend for making up MPG losses with small-displacement turbos has been taking hold for over 5 years now.

        Some of the manufactures have even been replacing 4-bangers with smaller (but turbocharged) 4-bangers. It makes the MPG number on the sticker bigger. How that translates into real-world performance is anyone’s guess.

        • 0 avatar
          tonycd

          kvndoom, you can’t “make up MPG losses with small-displacement turbos.”

          You CAN “increase your MPG with small-displacement turbos.” You can do it with a sedan, which is how the new Civic delivers such spectacular numbers both city and highway. Or, you can do it with a small SUV.

          But no matter how efficient your powertrain, you simply cannot push a jacked-up body through the air at highway speed with as little power usage as the same body mounted lower. Everybody who says modern SUVs don’t exact a fuel efficiency penalty is willfully ignoring this immutable fact. They can say the penalty is “negligible,” or “doesn’t matter to today’s buyer.” But as long as air has mass, they can’t argue it doesn’t exist.

          • 0 avatar
            kvndoom

            That’s what I meant. Making up the MPG gap between a CUV and a sedan by giving the CUV a smaller displacement engine.

            And if there’s no sedan to compare the CUV to, the CUV wins by default anyway. It’ll have better mileage than the pickup trucks and pony cars it shares the lot with, and that will be enough for its target buyer.

          • 0 avatar
            George B

            tonycd, part of the problem is that auto manufacturers are designing vehicles to pass regulations that have diverged from reality for typical American buyers. A tall boxy vehicle with a small-displacement turbo engine and an automatic programmed for the test does well enough on the EPA test cycle while being the right shape to pass European pedestrian safety regulations. Drive it slow with gradual acceleration to stay out of the boost and the measured fuel economy is impressive. However, if you put this CUV on the pedestrian-free interstate and drive with the flow of 80 mph traffic, it doesn’t come close to achieving the fuel economy measured in the test for the government. A lower height vehicle with a lower hood would have much less aerodynamic drag and it wouldn’t need huge wheels to balance out the proportions.

          • 0 avatar
            Lou_BC

            “make up MPG losses with small-displacement turbos.”

            I doubt that a manufacturer’s MPG test cycle based upon EPA/CAFE rules takes into consideration aerodynamic drag. If the engine tests to 40 mpg in a car, the odds are it won’t be too far off in a small SUV.

            They only care about the test cycle.

          • 0 avatar
            HuskyHawk

            Nobody cares about 2-3 MPG when you’re over 25 MPG already. It’s a statistic with declining value. Going from 15 to 18 is big. 25 to 28 has some minor value. 32 to 38 is all but meaningless. There is absolutely a “good enough” number for most people.

      • 0 avatar
        Russycle

        According to my Google the Crosstrek gets 5 fewer highway MPG than the Impreza(33 v 38). Assuming 10,000 all highway miles per year, that works out to about 13 bucks a month at $4/gallon. So, not a huge penalty for those 3 inches of clearance. But if you’re an OEM trying to hit CAFE numbers, could be a big deal.

      • 0 avatar
        thegamper

        At Tony…thank you. We obey the laws of physics in my house too. Heavier trucks, crossovers and SUVs will not be on too many consumer radars in a high fuel cost environment or after a fuel shock. I get axing the fiesta and taurus, but not the focus and fusion. They should be on offer even if they aren’t profitable. They are both in still large segments that consumers will flock to in a worst case scenario and you capture buyers that actually want this type of vehicle. Abandoning them is effectively abandoning 30% if buying public.

        That being said, who knows if it will sting them. But the value of those nameplates, which is considerable, will diminish with every year they aren’t produced and I’m sure plenty if current owners are thrilled about the sting to their resale. Enough so to look elsewhere next time.

    • 0 avatar
      threeer

      Husky…you hit it on the head with the “USB and play music” line. Most people (much less kids) simply don’t give two figs about driving dynamics. The march towards vehicle autonomy and appliance status moves on. I’m not even sure style much matters anymore. Yes, there are a few of us who still value driving dynamics (I was just “discussing” with the Missus that the next car we get should be a stick-shift. If I follow with the “happy wife/happy life” mantra, there won’t be a manual transmission-equipped vehicle in my driveway again unless I happen to win the lottery), but they aren’t the ones paying the bills to the car companies. I despise the decision Ford has made, but I can kind of see why they’re doing it.

  • avatar
    DeadWeight

    “This decision will generate negative repercussions over the next decade or more. For example, what about Ford’s ability to attract first-time buyers? What if fuel prices spike unexpectedly? What about consumers who genuinely prefer a car? No strategic decision comes without risk. But resources are not boundless, and difficult decisions must be made. So, what if customers in the compact and midsize segments do not show loyalty at rates similar to buyers in other segments? What if a 25 or even a 50 percent increase in fuel prices does not significantly alter consumer behavior?

    *We can be certain Ford has evaluated these questions and balanced the risks.*”

    I wish I had the time to eviscerate this ridiculous and wholly irrational editorial with the specificity that it warrants, but I do not at the moment.

    Suffice it to say that this is one of the clueless and shoddy editorials to be written regarding such a major, profound decision from an established automaker, representing a paradigm shift, and it’s riddled with assumptions that are not supported by historical precedent and that fail to fully outline (in any way) the extent of the massive risks taken, and that gives nearly blind deference to some FAITH that Ford executives, let alone those at any company, have the ability to know what the he!! Is going to happen, let alone be able to (wow, happy,’optimistic, Unicorn-level bullsh!t) “balance the risks.”

    • 0 avatar
      28-Cars-Later

      Whoa there DW, there have been some shoddy editorials but this is not among them. Should this have been deeper in analysis? Perhaps, this would have been more interesting. However given the audience and parameters its appropriate. Perhaps you could provide a deeper dive when time permits? :)

  • avatar
    28-Cars-Later

    This is a very well written piece.

    “These are the profitable sectors in the industry. They presently fund everything else the domestic manufacturers do.”

    I agree, but historically things can turn on a dime; i.e. 1973. Although Ford may say to itself, in such a situation we can import from Europe or China. If this is the wisdom and it is actually possible, Ford may be front running the latest trend.

    “Autonomous electrified transportation is around the corner.”

    Not really.

    “A Fiesta or Focus may be replaced by a subscription.”

    I cannot disagree but I in general question the wisdom of this. Car rental firms already have been known to miss things in cleaning and now we’re going to magnify this concept?

    “Get ready to learn why the rental business calls it the “ass tray.””

    https://www.thrillist.com/travel/nation/car-rental-horror-stories

    • 0 avatar
      DeadWeight

      ““Autonomous electrified transportation is around the corner.””

      Yep, sure.

      Just yet another example of how this editorial by Parks could’ve been penned by Jim HACKett, himself, or maybe Elizabeth Holmes of Theranos infamy.

      Ford’s going to also have Jetsons-like flying F-150s in mass production by 2025, too!

      • 0 avatar
        28-Cars-Later

        She’s too busy counting her profits from the most epic scam of the decade.

        Operation Fleece the Muppets.

        • 0 avatar
          jkross22

          Yet look at all of the members of the board she fooled…. people who should have known better but didn’t.

          • 0 avatar
            28-Cars-Later

            So here was the original swampy board who more than likely profited as they were all out by 2016:

            “In July 2011, Holmes was introduced to former Secretary of State George Shultz, who joined the Theranos board of directors that same month.[65] Over the next three years, Shultz helped to introduce almost all the outside directors on the “all-star board,” which included William Perry (former Secretary of Defense), Henry Kissinger (former Secretary of State), Sam Nunn (former U.S. Senator), Bill Frist (former U.S. Senator and heart-transplant surgeon), Gary Roughead (Admiral, USN, retired), James Mattis (General, USMC), Richard Kovacevich (former Wells Fargo Chairman and CEO) and Riley Bechtel (chairman of the board and former CEO at Bechtel Group).[65][66][67] The board was criticized for consisting “mainly of directors with diplomatic or military backgrounds.””

            Bechtel and Gen Mattis remained as of May 2016. Board members are typically granted stock and salary, so what was Dr Kissinger’s, Secy Schultz’s, Secy’ Perrys compensation and when did they sell?

            Holmes would be having coffee with Seth Rich right now if she truly stole from those three. This was a pump and dump, pure and simple. Maybe Kissinger et al found out about it and took their chips with them before it was too late and were not on it but that’s the only variable in my view.

            https://en.wikipedia.org/wiki/Theranos

          • 0 avatar
            jkross22

            Good point. Corruption rot is a feature, not a bug and it’s hard to imagine those guys getting burned. It’s the Leona Helmsley rule: they’re too rich to abide by insider trading rules.

          • 0 avatar
            dantes_inferno

            And the irony of that situation is Holmes probably won’t see one minute of jail time.

  • avatar
    EBFlex

    “Today’s Ford is a healthy, confident, customer-focused, future-oriented organization.”

    Clearly. Because healthy, confident, customer focused, and future orientated organizations kill off their cars because they cannot figure out how to make a profit rather than innovate and solve the problem.

    Ford is anything but healthy and confident. They are being run into the ground by a buffoon that sells chairs.

    • 0 avatar
      gmichaelj

      After reading “The Reckoning” and seeing that the Ford family held 40% of the voting shares I decided to “follow” Ford.

      I was under the impression that given the Company’s history, a new generation COULD fix the firm and could resist Wall Street’s influence.

      Apparently not. They are NOT “being run into the ground by a buffoon that sells chairs.” The Company is run by the Chair, who has hired and fired all of the CEOs for the past 20 or so years.

      • 0 avatar
        tonycd

        That is a fascinating book, gmichael.

        In case you haven’t had the chance, you’d also enjoy Car by Mary Walton, about the development and associated office political machinations around the birth of the ill-fated ovoid Taurus.

  • avatar
    NG5

    Has Ford detailed tangible benefits to consumers as a result of this decision (e.g. by detailing how previously allocated resources will be spent, future model plans or improvements likely to be coming to popular models)? The editorial seems to imply that they must exist but I can’t seem to find any in the text.

  • avatar
    kvndoom

    FCA has already been reducing its car lineup. I can see a future where nothing but the 300 and Challenger are offered. “Buy a RAM, get a free Fiat!” fire sales wouldn’t even surprise me.

    GM, as always, will wait and see how Ford fares. But I wouldn’t be surprised to see every car but the Camaro and Corvette eliminated in the near future.

    The import brands will continue to sell cars, because they don’t have the pickup truck volume to supplement their *UV’s. (Titan and Tundra aren’t ever going to gain any real marketshare) And they never will due to The Tax That Shan’t Be Named. But the model offerings will be heavily consolidated to whatever sells the best, with a sprinkling of niche offerings to keep the dwindling enthusiast population happy.

    • 0 avatar
      87 Morgan

      I only disagree with one point, which is the imports will carry the torch for small cars. I would not be surprised if the import brands don’t begin paring their car offerings in the next 5 – 10 years. Toyota and Mazda already offer too many car options that sell too infrequently as compared to the CUV parked next to it to matter. It always comes down the scarcity of dollars to spend on development and as car refreshes take longer and longer they will sell less and less until someday a Mazda 3 will quietly no longer be offered, same with a Yaris.

      • 0 avatar
        gtem

        “Toyota and Mazda already offer too many car options that sell too infrequently as compared to the CUV parked next to it to matter”

        Mazda, sure, but Toyota’s got their most-selling compact CUV (400k and change) selling alongside 310k Corollas annually iirc and 390k Camries. Will we see Toyota start shifting towards more CUVs? That seems to be the way the market is headed. But I think they picked their timing well to make a serious commitment to a thorough redesign of their sedans one more time and can now coast along for a decade or more on updates on the new platform (like they did with the K-platform for 16 years and the MC/new-MC for 15 in the US).

        • 0 avatar

          Dang! Those are expensive vehicles! $400,000 and $310,000. Pretty sure you meant $40k and $31k. :)

          • 0 avatar
            gtem

            Huh? I’m talking about units of cars sold annually of each model, not dollar amounts.

          • 0 avatar
            Big Al from Oz

            THX1136,
            You used the dollar sign, did you not notice no dollar sign denoted on the figures given by gtem?

        • 0 avatar
          geozinger

          @gtem:Look back on history. When the domestic US makers could not compete with the Japanese makers in the early 90’s, they decontented to go cheaper and beat Toyota/Honda/Nissan, et al. Then, seeing the resurgent domestic makes, the Japanese makers decontented too.

          FCA called it first, Ford followed and I suspect GM will follow before long, too. Which only means that Toyota/Honda/Nissan/et al, will follow also.

          The weight of popularity is upon the market. For better or worse, the market has spoken. Toyota can build a new Corolla, but once the general public’s focus narrows to S/CUV all the time, the other makes will have no choice but to follow.

          The Corolla will die in about five years if current trends continue. Or be another Toyota fleet queen, which is more likely. Bar codes for everyone, bartender!

          • 0 avatar
            gtem

            My own words: “That seems to be the way the market is headed.”

            What I’m saying is that Toyota picked the right time to do one more refresh on their sedans to set themselves up for one more product cycle to last a good long while with minimal investment, even as sales may inevitably decline. The hope may be that fresher product will absolutely bury the non-committal domestic offerings (see Ford throwing in the towel already, giving up their 200k unit Fusion piece of the pie).

            I think it’s naive to think the Corolla nameplate will be done in 5 years. Sales might decrease, but it isn’t going anywhere. That name has way too strong of a reputation and good-will all over the globe, to say nothing of the US. Same for Camry, same for Accord, same for Civic. They will probably cede sales to their own marque’s crossovers, but will still be strong sellers as the sedan market consolidates.

          • 0 avatar
            Lou_BC

            The Japanese sell most of their products globally. That alone ensures that products like the Corolla will survive.

    • 0 avatar
      ajla

      “FCA has already been reducing its car lineup.”

      FCA’s whole plan is to goose short-term profits and then sell “American” operations to China while getting Italy’s government to subsidize Fiat production. Then Sergio retires to run Ferrari and the Agnellis party on the hood of a Maserati.

  • avatar
    DenverMike

    First Time Buyers are overrated. Screw’em. There’s no guarantee they’ll grow with the brand, especially Ford/GM/etc. My first new car was a Mustang 5.0 stick, then a 4X4 pickup.

    How about bringing back the stripper Mustang 5.0 with crank windows, vinyl seats, and radio delete?

    But FTBs won’t be missed at Ford. FTBs should stick to “used” like the rest of us did. And who needs the wild depreciation of an FTB “entry level”? Any way let Toyota/Honda/Mazda/Kia/etc deal with them.

    And who exactly “needs” a trunk?

    • 0 avatar
      tonycd

      “First Time Buyers are overrated”?

      Tell Honda. They just played a major role in driving Ford’s entire U.S. sedan business into the ocean by parlaying two generation of first-time econobox buyers into lifetime loyalists who kept buying Accords and Civics as both were deftly floated upward in size and price to accommodate the original buyers’ evolution into middle-agers with discerning tastes and some disposable income.

      I work in marketing, and it’s axiomatic in any industry that it’s always several times cheaper to keep your own customer than to win conquest business by converting somebody else’s. Any business “plan” that doesn’t acknowledge this proven fact is not worthy of the name.

      (And Denver, apologies if I need my sarcasm batteries checked. But I suspect somebody really believes this if you don’t.)

      • 0 avatar
        PrincipalDan

        @tony… I’m fairly certain that Mike is being sarcastic.

      • 0 avatar
        DenverMike

        I agree with what you’re saying, except Ford/GM/etc aren’t the brands “to grow with”, but Toyota/Honda/etc are.

        That’s why it’s wasted capital coddling first time buyers for Ford/GM. They should focus on the 2nd/3rd/plus time buyers, careers fully underway (to grey hairs), cash to burn, then scoop Toyota and Honda’s boring “lunch”!

      • 0 avatar
        jkross22

        Tony,

        It seems like Ford said “Eff it. We can’t compete profitably against better run companies. Hyundai, Honda, Toyota and Mazda are better than we are. Pull up stakes.”

        At the same time, Mercedes is bringing the A class over.

        Says more about Ford’s damaged brand and why it likely won’t recover.

    • 0 avatar
      dantes_inferno

      >And who exactly “needs” a trunk?

      A pachyderm.

  • avatar
    87 Morgan

    Am I the only one confused with the response to Ford? It seems like their is this assumption that Ford is going to make huge gas guzzling SUV’s only. Did a press release come out indicating the return of the Excursion?

    What is the big deal, really? Toyota was mentioned. Okay great. How many new Rav4’s do you see vs. a new Corolla? How about Honda CR-V and the smaller HR-V compared to a Civic? The only new Civics I have seen are the SI. Honda Pilots are all over my neighborhood, Accords? Not so much.
    I think what Ford is saying is they are going to shift R&D dollars to develop what the public wants, small CUV’s that get decent gas mileage. When gas prices go up, I am willing to bet that hybrid technology will magically make its way into them, just like it did with Toyota Highlander and the up-market Lexus platform partner.

    The technology exists today to produce a CUV that gets car like mpg. The sacrifice is too negligible to matter to the standard issue don’t care about their car other than it is reasonably stylish and can carry their stuff and make them feel safe household. We are the weird ones here, not the other way around. I like my automotive weirdness though…

    • 0 avatar
      tonycd

      Morgan, across all the sedan-SUV comparables you mention (I corrected the “comparison” of the Civic against both the CR-V and HR-V combined), here are the March U.S. sales numbers courtesy of car sales base dotcom:

      RAV-4 34,937
      Corolla 29,245

      HR-V 7,753
      Fit 4,520

      CR-V 31,868
      Civic 32,584

      Pilot 14,158
      Accord 24,171

      Across all these models combined, the cars are still outselling the SUVs. One month does not foretell the future, but it doesn’t exactly sound like a market worth walking away from.

      • 0 avatar
        87 Morgan

        Honda perhaps.

        I see a lot of Toyota sedans in the rental lot and surprisingly not a lot of Ford product.

        I would be interested in how many Corollas and Camry are sold to actual households.

        Again, I have stated what my eyes tell me. I live in an affluent area no one drives a Corolla, Civic, Focus, Fusion, 200 etc. You see an occasional Lexus/BMW/Merc sedan but even those are few and far between these days. So perhaps my perspective is a bit jaded to what is happening in the real world. I kinda live in what seems to be a fantasy land these days.

        • 0 avatar
          gtem

          I was renting Edge Platinums and Explorer Limiteds all summer last year, and just had a Taurus Limited. But I’ve also had 2 Camrys over the last 2 years and a single Fusion. I usually reserve fullsize for what it’s worth, and SUVs when needed. This is Avis btw.

  • avatar
    stars9texashockey

    So Ford has abandoned being a full-line manufacturer of passenger vehicles and is instead buying an abandoned train station? That sure sounds like an organization that is “healthy, confident, customer-focused.”

  • avatar
    incautious

    So let me get this right. Ford can sell about 100,000 Mustangs a year and make money, but can’t sell 200,000 Fusions and make any money. Sorry not buying it. This is bean counters math. Just remember what happened to Chrysler when it dumped the Challenger and Barracuda in 1974. The market recovered and GM and Ford sold hundreds of thousands of cars a year and Chrysler lost out on all those sales. Basically handed the market over to its two competitors and put Chrysler on the verge of BK.

    • 0 avatar
      28-Cars-Later

      I’m not up on Chrysler history but I thought it was because the firm did not respond to 1973 very well, and even in 1978 was still selling boats like C-body New Yorkers.

      • 0 avatar
        gtem

        But Chrysler was the only one proudly selling a true FULL SIZE car!

        Not those dinky and undersized ’77 B bodies that were probably designed by European socialists! :p

        http://www.youtube.com/watch?v=TBiJX0uC-cE

        • 0 avatar
          28-Cars-Later

          True, but these were the same people who brought us the K-car shortly thereafter…

          • 0 avatar
            gtem

            I was joking, I think the B body was an absolutely brilliant move by GM and by all accounts a brilliant melding of improved fuel efficiency, handling, retaining interior room while cutting size and weight and keeping it handsome looking. I love the Royal Monaco for just how garish it is, but it was obviously a dinosaur and way behind the times, and I think sales numbers showed that.

        • 0 avatar
          FreedMike

          Well, if all you have to sell is something lousy, you sell it anyway, I guess.

          • 0 avatar
            dantes_inferno

            >Well, if all you have to sell is something lousy, you sell it anyway, I guess.

            Indeed. If they’re going down, they might as well go down swinging…

    • 0 avatar
      el scotto

      Mustangs aren’t discounted that much. Focuiis, oh yes (ignore those Camries and Accords down the stree)are discounted to be competitive. Fiestas exist to be cheaper than Corrola/Civic. Hyundai/Kia is realistically “the first new car I ever bought” category. It’s rough sailing in the seas of reasonably priced small car ocean. Or an a general rule of thumb: If a car is being sold at a deep discount, they’re not making money on it.

      • 0 avatar
        gtem

        “Focuiis, oh yes (ignore those Camries and Accords down the stree)are discounted to be competitive. Fiestas exist to be cheaper than Corrola/Civic. ”

        Why wouldn’t you compare Fusion to Camry/Accord and Focus to Corolla/Civic? Not sure if it was just a mistake or an interesting take I hadn’t considered. If anything I’d say you might be able to find a discounted Fusion for the price of a nicer Civic/Corolla, and a Focus for the price of a Yaris iA/Fit.

        • 0 avatar
          el scotto

          gtem, my mistake (and a good call-out). I just never paid much attention to the Fusions, or gave the much thought. Which would lead to a question of the day: “For the 120,00 miles would you rather drive a Fusion/Focus/Fiesta over it’s Japanese equivalent? I’ll go all Normy and say YES,; cheaper to buy and about the same over 120k miles.

          • 0 avatar
            gtem

            Strictly on the basis of cost, I think it’d be a matter of how much cash you could get on the hood of a Fusion versus a Camry (which has been the norm at Toyota dealerships for quite some time now), with the assumption that at selling time at 120k miles, the Camry would be worth a decent amount more. Aside from that I suspect neither car would need any real money spent on it outside of tires, brakes and other maintenance items. Whether someone would enjoy driving the Fusion over the course of that 120k miles versus a Camry is another discussion, one more favorable to the Ford I suppose.

            Car shopping for my then graduated from college gf back in 2011, my future father-in-law and I set out with her to test drive a number of midsize and compact cars, the top contenders in the end were a Fusion SE in the old pre-’13 body and a then new 2012 Camry. Local dealer let a Camry SE go for the same $20k that the Ford dealer was offering a Fusion for so that settled it. With 75k miles on it now, I have no doubt the Camry will be the cheaper car to own longer term in terms of residual value, and my confidence in the hardware.

          • 0 avatar
            PrincipalDan

            If someone really wants a Fusion Sport stupid cheap, that opportunity is coming up. (That’s about the only Fusion I’m interested in.)

          • 0 avatar
            gtem

            right on PrincipalDan. I cringe thinking about what would happen to those wheels/tires on our roads, but man that looks like a sweet package at a steal of a deal.

          • 0 avatar
            George B

            el scotto, I’d prefer the Ford Fusion over the Nissan Altima. What’s frustrating is that Ford finally made a class competitive car that doesn’t look or feel cheap, sells them in decent retail sales volume, and then decides to exit the market. Why not exit when they were building total crap?

  • avatar
    Arthur Dailey

    Agree that this reads more like an advertisement than a piece of reporting.

    Also sort of agree with Ford’s decision, but purely in regards to North America.

    Would rather see them emulate Toyota and VW and create a modern platform that could be used for 2 and/or possibly 3 ‘car’ models. One sedan, one hatch and one additional (a wagon?).

    The marketplace has decided that pick-ups are where Ford will make its money. And that SUV’s and CUV’s will augment this. Other posters are correct, the ‘car culture’ is now relegated to ‘cult’ status. It is no longer mainstream. Practicality is now the key and CUV/SUV’s are seen as more practical than a sedan and certainly a coupe.

    However Ford was for many years a ‘global powerhouse’. And there are still markets where ‘cars’ sell and can be profitable.

    As I have posted before and others above have posted, fuel prices are rapidly escalating this year. More increases and we could see an ‘about face’ in the market. Sure CUV/SUV’s get better mileage than previously but could these prices force consumers to make decisions regarding their 2nd/3rd family vehicle or first vehicle purchase based largely on fuel costs?

    • 0 avatar
      sutherland555

      Canadian consumers are getting screwed in this decision but clearly Canadian sales matter don’t matter all that much to Ford. They’re going to take a noticeable long term hit here. Ford dealership owners must be screaming bloody murder to Ford Canada HQ right now.

      As for gas prices, they’re only going up too for the summer season. Toronto prices are nearing the all time high and Vancouver just broke the record for highest gas prices ever in North America.

  • avatar
    volvo

    My take is that for sedans today it is the 1970s and 89s all over again. The oil crisis was only a small part of that domestic meltdown and should not be used as an excuse for that big 3 collapse.

    Imports ate the domestics lunch by offering a better product (handling, efficiency, build quality and reliability) at a lower price.

    Now they are doing the same in the sedan segment (and building them here). Sedans will be around offering a decent profit for the manufactures.

  • avatar
    SCE to AUX

    “What if a 25 or even a 50 percent increase in fuel prices does not significantly alter consumer behavior?”

    It won’t; Ford knows this, and so does FCA.

    The F-150 was the best-selling vehicle when gas was $4 ($5 CA). American buying habits only respond to spikes, and only temporarily. Fuel price-demand elasticity is weak in the the US market.

    As for first-time car buyers – not every mfr caters to this crowd. Besides, they can buy used cars, or a Ford CUV.

    • 0 avatar
      tonycd

      PrincipalDan, I’m afraid SCE proved my point after all: Not everybody who says “Who needs first-time buyers?” is joking.

    • 0 avatar
      ajla

      “The F-150 was the best-selling vehicle when gas was $4 ($5 CA).”

      If F-Series sales fall back to 413k then Ford will be bankrupt. It doesn’t matter if it is the #1 best seller or not.

  • avatar
    FreedMike

    Well-written, if a bit puffy. But I have to admit it – as much as I disdain this move, I see why it happened. Ford clearly thinks it can make more money making fewer cars. It’s their call.

    Frankly, if their new CUVs are as awful as the Ecosport is, they’re in trouble.

    We’ll see how it works.

    • 0 avatar
      tonycd

      Freed, in fairness to Ford, none of the CUVs in the Ecosport’s size class seem to get rave reviews. C-HR, HR-V, Trax, pretty much all the same.

      I suspect a car that tall, narrow and stubby just has inherent limitations, especially when the engineers also have to hit a low price. There seems to be a consensus you’re better off spending the same money on a used vehicle the next size up. This seems to turn out the same way as similar-sized sedans, like the Spark.

      • 0 avatar
        FreedMike

        You’re right, these are all compromised vehicles.

        But a HR-V has a decent back seat. A CX-3 or Trax doesn’t feel dead when you hit the gas. And so on.

        Unfortunately, the Ecosport’s the weakest player in a weak class. That doesn’t bode well for Ford.

      • 0 avatar
        dwford

        Maybe it’s that the Ecosport was designed for 3rd world markets back in 2012, and just got a massage 6 years later to sell in the US. Ford should’ve had a new generation of Ecosport ready by now anyway, but again is extending the production of an aging model with a new grill and dashboard, and trying to pas sit off as “new.”

    • 0 avatar

      In a recent government crash test the Escape finished dead last. With the exception of the Mustang and Navigator, Ford is a rubbish car company.

      Ford sucks dung.

      • 0 avatar
        dwford

        @akear: that’d not really a fair comparison. The Escape (released in 2012) wasn’t designed for the brand new passenger side offset test, like the newer models also tested.

    • 0 avatar
      joeaverage

      I can spend $23K on a new Ecosport or I can spend a little more and get to choose from some truly nice used vehicles with 40K miles on them.

      So my family chose the used option.

      I expect to get 200K miles out of this vehicle easily which represents alot of years at the rate we use a vehicle (slowly).

  • avatar

    Who are we kidding. Ford did this to prop up their share price on Wall Street. Hackett is just another CEO interested only in how Wall Street perceives the company. You don’t see healthy companies like Toyota, GM, and Nissan taking such drastic actions. All this indicates to me is that Ford is a company in poor health.

    No more Ford vehicles for me.

    • 0 avatar
      28-Cars-Later

      In all seriousness Ford may simply be front running the next trend. In theory, more fuel efficient vehicles could be imported from overseas production if needed. This is the opposite of the 1970s where these models mostly did not exist anywhere in a Detroit global portfolio. I disagree with the move as a consumer but if what I stated is possible I am now understanding the strategy better.

      • 0 avatar
        dwford

        The reason Toyota and Honda are successful is their consistency. You know that every 5 years you’ll get a new Civic, a new Camry. Yeah, sports cars come and go, but those are many vanity pieces for whatever executive is in charge anyway. Customers value consistency in the major market segments. It won’t be as easy as you think to totally pull out of the car market, then decide a few years from now “oh, we are back!” and have the customers come running.

        • 0 avatar
          volvo

          I agree with dwford “The reason Toyota and Honda are successful is their consistency. You know that every 5 years you’ll get a new Civic, a new Camry.”

          However for many of these buyers it is every 10-12 years for a new vehicle since most easily last that long without large maintenance bills. Even then you might get 10% of the new price rather than $500 when you sell it.

          If leasing a vehicle then the ownership period will be shorter (but the payments go on forever).

      • 0 avatar
        gmichaelj

        “Ford may simply be front running the next trend.”

        No they are laggards. FCA already dumped new car development (for the most part).

        Others kept up with the move to SUVs and Crossovers, Ford lagged.

        GM has 14 SUVs/Xs which sold 1.26 million units for the past year (ending March). These models are up 40% since YE 2014

        FCA has 11 models, sold 1.03 million, up 20%

        Ford has 8, which sold 806k up 14%, same time frames

    • 0 avatar
      SCE to AUX

      “Hackett is just another CEO interested only in how Wall Street perceives the company.”

      That’s the job of a CEO.

      • 0 avatar
        jkross22

        The CEO is also responsible for setting strategy, strengthening company culture and instilling confidence of it’s customers and employees.

        The problem with the CEO job description is that it’s tilted 95% to the Wall Street management part and the remaining 5% are split between other priorities.

    • 0 avatar
      TMA1

      Wait a minute, what do you mean, “no more Ford vehicles” for you? Are you saying that you were once a Ford buyer? I wondered where all the vitriol came from. Now I see it’s similar to a spurned lover.

  • avatar
    jdmcomp

    Listening to the news accounts carefully I note that some say Ford is quitting production and other say quitting US production. Confused, I know I am.

    • 0 avatar
      deanst

      They probably meant that ford will still sell small cars in foreign markets. If ford is wise enough to make these cars easily certifiable in North America, this whole discussion is a bit overdone.

  • avatar
    FalcoDog

    Ford kind of gave up on traditional family cars several years ago so this is no surprise to me. They are going were the money is.

  • avatar
    Whatnext

    Joe Biden had a word for articles like this one: Malarkey!

  • avatar
    dwford

    Sorry. The argument favoring Ford and it’s focus on profitability fails when you realize that the next generation of all of Ford’s cars have already been designed and are on sale (except for the next Fusion). In other words, the development money has been spent, but now it will be amortized over far fewer units – all sold overseas. Surely the new Fiesta (really just a heavy refresh of the previous generation) and the China Taurus (based on the Fusion) were designed to be sold in the US as part of the development process. Surely the various body styles of the new Focus (except the wagon) were designed to be sold in the US.

    Yes, sales are down, but part of the reason for that is that the cars are OLD. New models would help that. Yes the car market is in decline, but that’s when the automakers consolidate production to fewer plants, and send each market only what it needs. You don’t cut your legs out from under you and cease to be a full line automaker in your home market.

    Ford management thinks improved profitability will help the stock. Well 9 years of massive profits have seen the stock price FALL (since 2014 peak). How do they think several years of falling sales numbers are going to affect the stock? There’s only so long they can put an asterisk on the sales numbers and blame the decision to cut high volume models.

    • 0 avatar
      DeadWeight

      The future means that Ford can either be a full-line automaker like Toyota or VW, or a niche one such as Lamborghini, but it will struggle mightily to be something in the middle.

      The automakers that will survive in a heavy capex industry such as the automotive one are a) huge ones that leverage scale and produces full range of vehicles and compete in most big, global markets, and b) unique, specialized ones that produce truly bespoke, differentiated vehicles that command extreme prices and margins.

      • 0 avatar
        DenverMike

        @DW – As long as each model they sell is profitable, how is anyone to judge? Or care? All they need is one.

        Sedans are becoming more and more niche every day, but after this, only GM can be considered legitimately “Full-Line”, as most don’t even have a line of midsize pickups, let alone fullsize pickups.

        There is no brand loyalty, this isn’t 1955, and the typical house has a Silverado, Accord and RAV4 parked in front of it.

    • 0 avatar
      sportyaccordy

      New models would not help Ford. Many of the 2nd tier manufacturers have recently refreshed entrants in these segments. Malibu, Sonata, Optima, Elantra, Cruze- all down by double digit percentages. Even the benchmark Accord is down. What makes you think new Fords would do any better?

      Ford’s stocks are down for the same (irrational) reason other conventional auto stocks are down- Tesla. Even discounting that factor, explain how Ford selling cars they lose money on will help the stock? They are caught between a rock and a hard place.

      • 0 avatar
        dwford

        @sporty: those cars you listed all had questionable redesigns that didn’t advance them anywhere from the previous generation models. The Fords in question are all even older than those cars listed. Ford is losing money because they are stuck with extra production capacity for cars in a suddenly shifting market. Something easily remedied since these Fords have just all been redesigned. Consolidate production, send only what the market will bear.

        Aside from the ever fresh Mazda6 ( minor player), the Fusion is the oldest car in the segment (2015 update notwithstanding). Same with the Focus and Fiesta. How do you compete with brand new designs with only a new grill and some buttons on the dash? Ford’s habit of designing a car, then 4 years later giving it a minor update and continuing to sell it for another 4 years isn’t fast enough product development in this market.

        • 0 avatar
          sportyaccordy

          Questionable redesigns? The Malibu addressed every issue the last one had (the biggie being the wrong sizing). The Korean entrants were wise not to reinvent the wheel- their predecessors established a good thing.

          Not to mention, “How do you compete with brand new designs with only a new grill and some buttons on the dash?” Toyota did exactly that with the Corolla and Camry, and Honda did it with the 2006-2015 Civic.

          Ford’s offerings had some issues for sure, but then so did pretty much everything but the Accord. It’s really less about the cars and more about the brand, which is still Ford’s doing, but not solvable by a quick fix.

  • avatar
    schmitt trigger

    The new Ford motto:

    “One can buy any Ford vehicle you want, as long as it is a SUV/truck”.

  • avatar
    sportyaccordy

    The overreactions to this move are mind boggling. Take a gander at your local new Ford listings. Their whole lineup is going for 20-25% off, except for the F-150. Yes, even the crossovers. The difference is those crossovers have much more profit baked in than something like a Fiesta.

    And all the arguments against it have been proven false by this thing called reality. “What happens when gas spikes????!?!?!?” The same thing that happened after the recession when gas prices hovered at $3.50 for YEARS. People continue to abandon cars for crossovers, manufacturers continue to make powertrains more efficient so that the high rider fuel penalty becomes less of an issue. A CR-V gets 1-2 MPG less than the Accord on the combined cycle. “What happens in the next recession???!?!?” We all die.

    For everyone literally SCREAMING at how terrible of a move this is, what do you suggest Ford do? Double down on unprofitable sedans whose sales are quickly trending to zero? It seems auto enthusiasts are even more clueless about the business of selling cars than I thought.

    • 0 avatar
      ajla

      “what do you suggest Ford do?”

      Mustang-based sedan.
      Mustang-based Lincoln.

      One thing enthusiasts are apparently *correct* about is that there is some money in niche products that isn’t available in the high-volume lines.

      • 0 avatar
        sportyaccordy

        If Mercedes is having some trouble selling a brand new E-Class I don’t see much in the way of success with Lincoln trying their hand. Plus the Mustang’s space efficiency is abysmal. It’s about the size of a 5 series with the interior space of an old 1 series.

        • 0 avatar
          ajla

          I don’t see what the E-class has to do with anything. I’m proposing a niche, non-core product and if these past days have shown us anything it is that “success” should be measured by profitability instead of sales volume.

          The engineering for the car is already done, everything but the sheetmetal can be off the shelf and Ford is already committed to keeping the (currently profitable) Mustang alive into the future.

          They should make a Lincoln version.

          • 0 avatar
            SC5door

            There was rumored to be a Mustang based Lincoln…..I haven’t hear anything else about it so I’m sure that project has been killed.

  • avatar
    packardhell1

    I see this playing out like Taco Bell in Demolition Man – one will persevere and it will be the one nobody expected – the MINIVAN!

    My wife and I have two kiddos (planning on a few more babies as we are foster parents) and have gone through the following vehicles: 1997 Buick Regal GS, 2007 Chrysler Pacifica, 1998 Dodge Grand Caravan, 2004 Honda Odyssey, and now a 2012 Grand Caravan.

    The Regal was a sedan and the supercharged 3.8 was fun. I wish the rear doors would have opened a smidge wider to get babies into the car seats. The trunk was big enough for a big stroller and a few other things, but not much more than that. We couldn’t fit a double stroller and a week’s worth of groceries. The Pacifica had a lot of room in the rear with the third-seats folded down and it was a bit higher off the ground, which helped with getting kiddos in and out. It also towed a utility trailer pretty well (very stable, being low + wide + fairly heavy). We already know the minivans have tons of space.

    My point is, I see why Ford did this and I see why folks buy things other than sedans. Yes, you are paying a penalty for anything other than a sedan. However, a sedan doesn’t match what our Pacifica could have done our what our GC/Grand Caravan can do. Our GC is quick enough with the Pentastar. I think it handles well, it does better than its EPA of 18/25, and last week I could haul my wife, 2 kids, a mattress, and box spring in one load while it was raining outside. I can’t do that in a sedan.

  • avatar
    dal20402

    It’ll be interesting to see lease rates on Fusion Energis in 2019. My wife hates sedans, but by then both kids will be able to climb into their own car seats (making seat height issues less important) and a cheap enough lease might persuade her into one to replace our C-Max coming off lease next April.

  • avatar
    Jeff S

    I am not going to buy another Ford regardless if they make another car. Mismatched trim and door seals that are coming off on a 35k Ford Edge don’t inspire me. I start to wonder if they missed that what else is missing. I have had Fords in the past without these issues but many of the new Fords have returned to sloppy and ill fitting trim which is reminisce of the mid 70’s Big 3 quality. You don’t see a Honda, Toyota, or even Nissan with misfitting trim and lose door seals. I don’t fault Ford with getting rid of cars as much as letting their quality slip. Fords overall quality has slipped.

    • 0 avatar
      Jeff S

      In addition the newer Focus with the automatics are about the worst small car I have driven. The transmission feels like it is going to go at any time and interior pieces falling apart on a car less than 3 years old. My experience with a company Focus. I was impressed with the company C-Max but that is not long for this World because that is getting axed. Sorry but I will take a Kia or Hyundai over many of the newer Ford cars I have driven.

      • 0 avatar
        sportyaccordy

        I have a 7 year old MKX and have had many Ford rentals. Our experiences differ.

        No matter though. Powershift has pretty much doomed Ford’s future in cars.

  • avatar
    hpycamper

    Not much said about the dollars being spent on autonomous tech, which is probably where the money that would have been spent on developing new cars came from. I don’t see full autonomy happening without dedicated roadways, or seriously improved roadways, so probably lots of money going down the drain for this tech without massive spending for roads.

  • avatar
    conundrum

    Ford has had trouble flogging vehicles in China recently, like an 18% decline in 2017 over 2016. They’re on their second local CEO there in six months. In Europe people tend to buy or PCP a downmarket German vehicle with a badge rather than buy a Ford or Opel mid range car. The Japanese hardly compete there anymore except for Nissan flogging Qashqais, and Renault takes up the car slack for the Alliance. Hyundai does OK there, but worldwide, it’s struggling, down 8% or more from 2014 highs.

    I don’t credit Ford with any special insight, but it does seem that even before Hackett arrived they were waving their hands about crying Me Mobility Digital Savvy a lot to impress the brainless twits on Wall Street who so knowlingly gave Tesla a market cap above GM. For those Wall Street leeches who now demand constant clueless press releases a la Musk to stir stock prices and generate “excitement”, Ford is essentially blackmailed into doing “something”, whether sensible or not.

    “Today’s Ford is a healthy, confident, customer-focused, future-oriented organization. And that’s the way I’d like to see it remain.”

    What a load of old rope!

    As I was wafting past the main Ford dealer while test driving a new Mazda6 turbo last week, the runny-nosed Tonka toy Ecosport sat on a ramp out front trying to impress passers by. They’re going to need help polishing that little t*rd into something passably competitive to any but brain-dead customers. The Mazda though is now a grown-up vehicle, quite different from the tin can 2014 I drove, actually quiet. A wafter with wick and great steering. And darn it, it’s a bloody sedan!

  • avatar
    tylanner

    To be fair…it is a lot easier to build aluminum bathtubs with wheels than actual vehicles….

  • avatar
    05lgt

    Ford marcom wrote this. Don’t post others work as your own.

  • avatar
    Jeff S

    I wish Ford well, I bear no animosity toward them. I am just not that interested in their vehicles except maybe the new upcoming Ranger and even then I might lean more toward the competition. I have had 2 Fords in the past that were good cars and a Mercury Lynx that was not so good. I am more likely to buy a Honda, GM, Toyota, Hyundai, Kia, or Nissan than another Ford. If I were buying a car the Fusion would be one I would consider but after driving a Focus I would not buy a Focus.

  • avatar
    WildcatMatt

    This was touched on in a couple of comments but I want to bring it front and center: Ford is still going to make sedans in other parts of the world.

    While I do scratch my head a little about ceding the market, only Ford knows what its margins are and that has to be the driver here.

    We’ve kind of seen this before, really, with the Ranger. Ford let the Ranger go when the margins vs. investment wasn’t working for them but now that the market seems better it’s coming back, albeit a couple years late.

    If they’re smart, they’ll learn from the decisions around the Ranger and whatever they have in the pipeline in Europe or China will be designed in such a way that they can be brought into the US with minimal changes in short order if the market pivots.

    Know when to hold ’em, know when to fold ’em, right?


Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • geozinger: Fnck. I’ve lost lots of cars to the tinworm. I had a 97 Cavalier that I ran up to 265000 miles. The...
  • jh26036: Who is paying $55k for a CTR? Plenty are going before the $35k sticker.
  • JimZ: Since that’s not going to happen, why should I waste any time on your nonsensical what-if?
  • JimZ: Funny, Jim Hackett said basically the same thing yesterday and people were flinging crap left and right.
  • JimZ: That and the fact that they could run on gasoline, which was considered a useless waste product back in the...

New Car Research

Get a Free Dealer Quote

Staff

  • Contributors

  • Timothy Cain, Canada
  • Matthew Guy, Canada
  • Ronnie Schreiber, United States
  • Bozi Tatarevic, United States
  • Chris Tonn, United States
  • Corey Lewis, United States
  • Mark Baruth, United States
  • Moderators

  • Adam Tonge, United States
  • Corey Lewis, United States