Ford Motor Company stunned the world this week by announcing that it would stop selling cars in the United States over the next few years, except for only two: the iconic and ever-popular Mustang, and the Ford Focus Active, a crossover hatchback/SUV that goes on sale next year.
In its earnings report for the first quarter of 2018, the company announced: "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." In other words, if you miss having the option of buying a Ford sedan, blame the millions of Americans who haven't bought one in the last several years.
Here's why Ford's response to current market realities is so very smart:
1. It's giving drivers what they've shown they want.
For most Americans what they want is: bigness. Big, chunky SUVs and trucks that can haul all our stuff and take up parking spaces all the way to edge, and give us a high-up vantage point over the road, and at least look like they can handle all kinds of terrain, whether or not they actually have the all-wheel drive to do so.
For years, the market has been trending towards vehicles like these, and also "crossover utility vehicles" such as the highly successful Subaru Crosstrek. By going all-in on the Focus Active, Ford is merely following market trends, and might give the Crosstrek some meaningful competition.
2. There's only one problem with SUVs, and Ford is solving it.
I'll always remember how thrilled my husband was when he finally bought a Land Rover Discovery after dreaming about it for years. And how he sold it again a few months later because filling the tank was driving him toward insolvency. Low-ish gas prices over the last few years have taken a lot of the sting out of owning a gas-guzzling SUV but they're on the rise at the moment and no one knows what the future holds for prices at the pump.
Ford is addressing that issue, the company says by "adding hybrid-electric powertrains to high-volume, profitable vehicles like the F-150, Mustang, Explorer, Escape and Bronco." Going hybrid is one way to give American consumers the big, brawny vehicles most of us want without the usual dread of pulling up to a pump.
3. It's betting big on electric.
I didn't even know gas prices were going up until someone pointed it out to me. That's because I'm an electric car driver and I haven't put gas into a car since September. I'm not planning ever to buy an internal combustion car again, so I may be done with the whole gasoline thing forever.
I'm not the only one--most people who try electric cars say they won't ever switch back. And legislation in several U.S. states, not to mention foreign countries, is pushing the auto makers of the world in the electric direction. Ford seems to see that the future is electric and promises it will start rolling out electric vehicles in 2020 with a "performance utility" and that it will have 16 battery-electric models in the U.S. market by 2022.
A year ago, the company said it was building an all-electric SUV with 300-mile range, but hasn't provided much detail about it since. It does seem to be phasing out the Ford Focus Electric (again, because it's a car, not an SUV or CUV). That's a shame: the Focus Electric had a great reputation, and was once ranked by the EPA as the most electric-fuel-efficient compact car sold in the U.S. That was before the phenomenally successful Chevy Bolt, but I'd have liked to see Ford give the Bolt some serious non-Tesla American car competition.
Still, it seems that Ford is generally heading in a smart direction. While I'm happy with my Nissan Leaf, my husband is still pumping gas, mainly because he likes the roominess and height of an SUV as most Americans seem to. If Ford can build something electric that will satisfy that desire, it will definitely be on to something.