Ford‘s passenger car lineup is going to change significantly over the next few years.
Last week, the American automaker made the surprising reveal that the only passenger cars it will keep in its lineup is the new Focus Active and iconic Mustang. That means the Fusion, Fiesta, and Taurus are on their way out over the next few years. But why is Ford going that direction? “We’re going to feed the healthy part of our business,” said CEO Jim Hackett. “and deal decisively with the parts that destroy value.”
What isn’t a surprise is the healthy part of Ford’s business. At the center of it are pickup trucks, crossovers, and SUVs. The company believes the change will change $25.5 billion in costs by 2022, which is nearly double the $14 billion it had identified as of October. Ford’s CFO, Bob Shanks, says that cars, “most Lincoln products,” and parts of Ford’s overseas business are among the value destroyers. Combined with the demand for cars dropping, Ford’s decision may be bold, but it makes financial sense.
Ford isn’t the only American automaker from the Detroit Big 3 making changes. FCA previously announced it was killing off the Chrysler 200 and Dodge Dart, while GM plans on getting rid of a production shift at its Cruze plant in Ohio, while adding jobs in Tennessee to build more crossovers.
For now, Chevrolet says it won’t be following in Ford’s footsteps, but it has been reported the company is looking at eliminating some of its slow sellers such as the Sonic and Impala. But GM is looking to leverage Ford’s abandonment of the market, with GM spokesman Jim Cain saying it “gives us an incredible opportunity to further narrow our gap to Ford in the profitable commercial vehicle segment.”
[Source: Automotive News]
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