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Ford To Phase Out 'Traditional Ford Sedans' Such As Fusion And Taurus In The U.S.

Apr 26, 2018
Originally published on April 26, 2018 8:44 am

Ford Motor Co. reported a $1.7 billion profit for the first quarter of 2018, but the company says it's planning big changes — such as phasing out all cars except for the Mustang and a crossover vehicle in the North American market, so it can focus on SUVs and trucks.

"Given declining consumer demand and product profitability, the company will not invest in next generations of traditional Ford sedans for North America," Ford said.

The cuts will take place over the next few years, Ford said. Over that time, it will phase out longstanding brands such as the Ford Fiesta and Taurus from the North American market.

Ford says that Lincoln sedans, including the Continental, will not be phased out.

With the planned cuts, Ford will say farewell to the Fusion sedan, of which 43,176 have been sold so far in 2018 — and the Focus, of which Ford has sold 35,046 cars this year. Over the same period, Ford has sold 19,164 Mustangs.

The Mustang and the upcoming Focus Active crossover are poised to become the only cars Ford sells in the North American market. The new U.S.-market version of the Focus will be made in China.

Ford says no American jobs will be lost as a result of the plan. Company spokesperson Daniel Barbossa says that of the phased-out vehicles, the Taurus is the only one made in the U.S., at the company's Chicago factory. That factory, Barbossa says, will stay busy making the Explorer and a new SUV.

In another change, Ford says it will add hybrid motors to its profitable high-volume vehicles, like its F-150 truck, Explorer and Escape SUVs, and the Mustang.

Ford outlined the bold strategy shifts in a news release about its first-quarter financial results, which continues a streak of billion-dollar profits. In the same quarter two years ago, for instance, Ford reported a $2.45 billion profit.

So far in 2018, Ford said, the rise in its net income is "more than explained by a lower tax rate." The company's balance sheet shows an effective tax rate of 9 percent for the quarter.

The deep cuts to Ford's car lineup are part of the company's goal of creating "a winning portfolio and focusing on products and markets where Ford can win," the company said.

By 2020, Ford said, nearly 90 percent of its portfolio in North America will be trucks, utilities and commercial vehicles.

Ford could look like a very different auto company in just a few years' time. In addition to putting hybrid-electric power trains into high-volume sellers in its SUV and truck line, the company will roll out a "performance utility" vehicle powered by an electric battery in 2020.

Ford also says it will have 16 battery-electric vehicles on the market within the next four years.

The company is also reviving two of its historic vehicles: the Ranger pickup, which will return in 2019, and the Bronco SUV, which will return to the U.S. market in 2020. It also plans to bring a smaller, rugged SUV to market.

The formal shift away from cars comes after Ford sold 128,794 cars so far in 2018 — a drop of nearly 14 percent from the same period in 2017. In that same span, the company sold 202,927 SUVs and 267,860 trucks.

Ford says that it "maintains the highest transaction prices of any full-line automaker – $36,300 per vehicle."

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