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Ford to Drop All Passenger Cars in U.S. Except Mustang


#1

Just when you thought it couldn’t get any worse for anyone who preferred passenger cars to crossovers:

This monumental decision from Ford not only smacks of cowardice - many other brands haven’t given up on mainstream passenger cars yet, despite steadily dwindling sales in the face of the current crossover boom - but is also extremely short-sighted, considering that the Fiesta, Focus and Fusion are genuinely good and do not deserve to be withdrawn from the lucrative U.S. market, even if it helps Ford’s bottom line. At least the Mustang will live on, but as a dedicated enthusiasts’ car, it won’t cater to the same market as the Fiesta, Focus and Fusion did.

Worryingly, this cull of Ford’s lineup could kick-start a trend in which every other major manufacturer decides to throw in the towel and axe every passenger car in their range (except, probably, for dedicated sports cars) in favor of putting all of their eggs in the SUV basket - and the fallout might not even be limited to North America this time. If this trend reaches its conclusion, with the exception of sports cars and supercars, there might not even be any passenger cars left for us to buy anywhere at all!

So what do you think of this? A shrewd move from Ford, or a misguided attempt to stay relevant in an ever-changing landscape? I’ll let you decide. But the motoring landscape of the future is clearly destined to be dominated by, if not exclusively comprised of, crossovers and SUVs. If that’s progress, I’d rather live in the past.


#2

I know first reply slightly off topic but why do they consider crossovers/SUVs separate from cars in english? What’s the difference? It’s not offroad ability or chassis/mechanical etc so…?

Or is it just because of all the disdain the car community has towards them


#3

They are cars, its just that crossovers and SUVs are their own segment. Like how in america, you have mid-sized, full-sized and sub-compacts.


Anyways back on topic, Ford isn’t doing this because they’re stupid.

As you can clearly see, the Fiesta is not selling. Sales of the Fusion are also dropping drastically, same for the Focus. But as you can see, what is selling is the Ford Explorer, Escape and Edge. What’s more, is that Ford’s trucks arent on this graph, because those are selling like hotcakes.

Point is, Ford doesn’t make any money by selling the cars you say America “needs”. Instead, Ford is selling cars, America “wants”.

Going on about the point that this will affect everywhere, I doubt it. Europe and Asia are completely different from the US. The Fiesta, Focus and Mondeo will continue to sell there because its profitable there.


#4

Wasn’t it the fact that Ford focused mainly only selling gas guzzling SUVs and trucks that nearly made them go bust not all that many years ago?

All it will take is another surge in price for fuel for them to sorely regret that decision…


#5

The American market craves crossovers, so there’s not much that can be done. However, with fuel prices on the rise, perhaps we see this trend of crossoverizing everything slow down or stop for some time. Who knows, we’ll have to keep an eye out.


#6

You might just have a point - if for some reason the U.S. government decides to come to its senses and disincentivize the production and sale of SUVs, crossovers and light trucks by such means as raising fuel economy standards for manufacturers’ entire lineups (or, better still, imposing heavy taxes on cars with high curb weights), Ford’s withdrawal from the passenger car segment will most likely backfire spectacularly, and they might even have to reintroduce all the slow-selling cars they had worked so hard to eliminate from its line-up. After all, it’s not that it’s morally wrong to buy a passenger car instead of a crossover; it’s just that Americans have lost interest in them, possibly forever.


#7

They already do with CAFE regulations. Ford is ahead of the curve on fuel economy.


#8

Besides Americans buying crossovers in higher volume, there is more profit in a crossover. GM is due to come out with a crossover built on the same platform as their subcompact car. Where that subcompact will retail from below to just over $20,000, the crossover, with a few hundred pounds of extra sheet-metal will retail around $25,000.
Ford is also retaining the Focus, although it is said to be crossover-inspired.

As I’ve just recently started driving a CUV myself, I can say this: Even with my full size cars, my three children have complained about how cramped they were in the back seat. They’re not even that big. They can all ride comfortably in the back of my Equinox (which is considered compact). If I need to move big objects, such as furniture, I no longer have to rent a truck; which is convenient. My Equinox gets as good gas mileage as any of my old cars did, with the exception of my sub-compact Ford Escort.


#9

I can’t say it’s surprising, and I don’t think it’s suicidal. What’s suicidal is continuing to build unprofitable cars, and then be saddled with all that overhead when the next recession hits. Ford, if you’ll recall, was the only American car company that didn’t need to be bailed out during the great recession, and the crash of the auto industry at that time had nothing to do with fuel prices, it had to do with the credit crunch, and general, massive economic downturn thanks to the collapse of the mortgage/housing market.

Gas isn’t exactly cheap either, but drastically improved fuel economy in larger vehicles, negates what was a major drawback just a decade ago. Just last year, we rented a 4x4 Chevy Suburban in Alaska, drove 1,300 miles and averaged 19 MPG. I was blown away at how great the fuel economy was for such a behemoth of a vehicle. About 13 years ago I had a Chevy Avalanche, which is basically a Suburban with a truck bed instead of a cargo area, and that got 14 MPG.

Crossovers have basically just supplanted the mid-size and compact car market, and they are in essence, just taller midsize and compact cars, with similar fuel economy, and similar prices to boot.

My wife drives a 2012 Subaru Outback, which is more wagon than crossover, and it gets about 31mpg. I have a 2014 Jeep Cherokee which is a crossover, and I manage about 29mpg. Both are AWD 4 cylinders. We live in snowy mountain country, so AWD is a must-have for us, and most passenger cars aren’t available with it, and the ones that are, are usually in expensive trim levels that out-price a more basic cross over.

Then there is the demographic shifts happening in America. We are an aging country. (Most of the industrialized world actually has this problem worse than we do), and old fogies like me just don’t really care about carving up corners anymore. We want quiet, comfortable, safe, affordable, practical… The younger generation is less and less interested in driving at all, so all those Fiesta’s just don’t have a market here as young people use Uber, or bikes, or just walk which coincides with another American trend…Urbanization. A greater concentration of the population lives in cities now than at any time before, making the need for private vehicle ownership less necessary.

I think Ford just see’s the writing on the wall. Things change and you either adapt or die. Major iconic American companies are struggling or dying off left and right, Sears, Toys R Us, General Electric, lots of grocery chains…it’s a mess, and Ford obviously doesn’t want to wait too long to adapt. It does them no good to be the last buggy whip manufacturer after all…


#10

As others have indicated, that’s quite unlikely to occur. Sales are down and the fragmentation of the market and availability of crossovers of all sizes and capabilities at any price means reasons to buy conventional styles are shrinking, because consumers just have so much choice. Besides the market for subcompacts and compacts in the US in has been shrinking for quite a long time in general (subcompacts declined by a further 10% this quarter again, for instance). Just the fact that companies are investing into exploring all the niches of the crossover format, and then looking at the insane sales booms in each (e.g. hybrid crossovers have seen sales increases from 30% all the way to 1044%) definitely hints that Ford is on the right track with their good CAFE record and focusing on trucks and crossovers.

Not only this, the fact remains that they’re crazy profitable, to quote: “the segment has seen an estimated 80% profit improvement on a 25% increase in volume between 2013 and 2017.” The government imposing higher fuel eco requirements will mean nothing, we’re in the era of 30mpg trucks already.

In the end, spending money developing a wide variety of models for a lineup where a majority of them don’t sell makes no sense. They might as well just keep the money to themselves and only make the cars that maximise their profit.

Don’t assume that consumers know exactly what they want or that you know what to make for them perfectly. To give an analogy (adapted from a book):
Say you go to the doctor’s. In the first case, you mention that you fear that you may be at risk of heart conditions because a lot of your friends are coming down with such issues. The doctor goes: “great, thanks for letting me know, I’ll schedule a slot next week and you’ll get some stents”. You may or may not have any issues. The point I’m making is that the loudest people who demand sporty cars or manuals or wagons are not the majority of the market. Those models are great for engaging and marketing and all but the numbers don’t lie - the majority of the world don’t care. Ford is a company that survives from mass production and they need to follow through with the trends to stay alive. Plus if they don’t profit today and build up money to invest into future models, how do you expect them to react to changes, if say, crossovers end up becoming unfashionable again?


#11

Ford’s European division will still develop fuel efficient cars, which if they are smart will be designed for easy reintroduction in case of large fuel price increases. GM has a lot more trouble on this front if they also drop car development in North America since they just sold off their European division (Opel/Vauxhall); I believe GM’s remaining economical (smaller) cars are developed by GM Korea which recently just avoided declaring bankruptcy.


#12

I don’t doubt that Ford Europe will continue to develop the same models for Europe, and if need be they could reintroduce the new models over there. The only concern then is that they will reintroduce because they’ve ended up desperate, but it is all hypothetical anyway.


#13

They got lucky and borrowed a lot of money for restructuring when Mulally took over. So they had the cash to “weather the storm”.

As for the article itself, I also believe the “doom and gloom” is unwarranted, but the short-term impact will be negative from a PR standpoint. It just reeks of defeat. From a financial standpoint, it’s a brilliant idea and from what I remember reading, they’ll save some $23-25 billion by 2023.