Ford Cutting Small and Mid-Sized Sedans

Ford Motor Company yesterday released its first quarter 2018 financial results. In the release Jim Hackett, president, and CEO of Ford provided an update to Ford’s strategic framework, declaring one way that Ford will create long-term value is by:

Building a winning portfolio and focusing on products and markets where Ford can win. For example, by 2020, almost 90 percent of the Ford portfolio in North America will be trucks, utilities, and commercial vehicles. Given declining consumer demand and product profitability, the company will not invest in next generations of traditional Ford sedans for North America. Over the next few years, the Ford car portfolio in North America will transition to two vehicles – the best-selling Mustang and the all-new Focus Active crossover coming out next year.

The company is also exploring new “white space” vehicle silhouettes that combine the best attributes of cars and utilities, such as higher ride height, space, and versatility.

Currently, Ford sells six sedans and coupes in North America: the Fiesta, Focus, Fusion, C-Max, Mustang, and Taurus. This lineup hits multiple segments, from the compact Fiesta to the mid-size Focus, C-Max, and Fusion to the full-size Taurus. The Mustang stands alone as the lone coupe.

It may be likely that Lincoln’s sedans will also disappear, though this was not explicitly stated in yesterday’s press release. Lincoln currently sells the mid-size MKZ and full-size Continental — both share platforms with Ford counterparts. Since Ford will be phasing out development of sedan platforms, Lincoln may suffer, too.

This reduction in traditional cars was a long time coming. North America consumers have increasingly turned to crossovers, trucks, and SUVs over sedans and small cars.

As of April 3, according to the Wall Street Journal Top 20 Auto sales in March – 13 are a combination of SUV, Pickup Truck, and crossovers. The Ford F-150 tops the list for March at over 87,000 sales. The Toyota Camry comes in at fourth with over 35,000 in sales.

It will be interesting to see if other automobile manufacturers follow the Ford strategy.

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