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RightNation.US: Ford is basically giving up on US car business, and GM is not far behind - RightNation.US

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Ford is basically giving up on US car business, and GM is not far behind
Robert Ferris
Published 1:20 PM ET Thu, 26 April 2018 Updated 5:24 PM ET Thu, 26 April 2018
© 2018 CNBC LLC. All Rights Reserved. A Division of NBCUniversal
Source; excerpts follow, drill down for hyperlinked references:


So is it really the end of the American car on its home turf?

From the way Detroit's major executives are talking, it would seem so.

Ford said Wednesday it will only offer two new cars in North America over the coming years — its iconic Mustang and the Focus Active, a rugged-looking hatchback that has already debuted in Europe, and somewhat resembles the Subaru Crosstrek or the Buick Regal TourX.

GM is moving along the same lines.

"I think we have been on this path for a number of years," GM CFO Chuck Stevens said on a call with reporters on Thursday, after the largest U.S. automaker released first-quarter earnings.

Many of Fiat-Chrysler's biggest successes have been SUVs in recent years, evidenced by the growth of its Jeep brand.

"Virtually eliminating Ford's NA car portfolio makes a lot of sense, in our view," said Adam Jonas, an analyst at Morgan Stanley. "No more Fusion. No more Focus. No more Fiesta. No more Taurus."…

What will they sell instead?

Detroit is already strong in pickups and large SUVs, such as the Cadillac Escalade and Lincoln Navigator, which is enjoying remarkably brisk sales after its first complete redesign in more than a decade. The Big 3 control almost 85 percent of the domestic pickup market, according to LMC Automotive, despite competitive products from foreign brands such as Toyota and Nissan.

And Ford, for example, will also double down on "authentic off-roaders," Ford President of Global Markets Jim Farley said on a conference call Wednesday, after Ford reported first-quarter earnings. This includes trucks like the Raptor, and the upcoming reintroduced Ford Bronco, and an unnamed SUV. GM and Chrysler are entering this segment, too…

In ditching cars and pursuing this strategy, Ford made a difficult choice, said Kelley Blue Book analyst Rebecca Lindland.

"I think this is one of the challenges that the Big 3 has faced, that they really had a tough time finding their way on the car side," Lindland told CNBC. "They have struggled for too long to be profitable, to be a full-line manufacturer, and they have made the hard decision to start over. The problem is they are so far behind."…

Full article

There's nothing necessarily disagreeable with this article; adapt or die; that's a lesson that American vehicle manufacturers learned the hard way. Just as they had to let some nameplates go (Mercury and Oldsmobile come to mind), they're making decisions to adjust their model lines to better fit public demand and market share.

However, Ford was at the forefront of the demand for American personal truck and van ownership (F150, E150, etc.), and they were at the forefront of American-brand hybrids, so I think they may have something up their sleeve.

I believe Ford will be back with a line of electric-only sedans in 3-4 years.

Ford is already moving away from the "gasoline engine with electric assist" hybrids (like mine) toward "plug-in electric vehicle with gas engine assist" Energi line. Well, if you want a plug-in electric vehicle, it's inefficient to cart along a gasoline engine as well, so…

Musk might be struggling with Tesla but he's a paradigm-changing maverick. Ford (and others) can take their time developing all-electric vehicles while Musk does the hard work of setting up a plug-in infrastructure.

This is all speculation of course, and realization is still years away. But there's only so much oil in the world, it's getting increasingly harder to find, and eventually everyone's primary vehicles (assuming personal ownership and reliance thereupon is still popular) will have to be less reliant on fossil fuels.

2 Comments On This Entry

Or, it could be that Ford has forgotten how to market anything but Trucks and Mustangs, and Mustangs pretty much sell themselves.

At the upper end of Ford Motor Co, I looked Lincoln's web site. On the front page: five barely-distinguishable dull grey vehicles. Against a dull grey background. Meh. Do they not realize there's a difference between "elegantly understated" and "flat-out boring"?
They did it to themselves. Zero sympathy.
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