When Ford decided to discontinue the Fiesta, Focus, Fusion, and Taurus a few years ago, it raised more than a few eyebrows. The same scenario played out in Europe, where the Fiesta and Mondeo were phased out, and the Focus is set to retire in 2025. Why is the Blue Oval abandoning its car lineup? According to CEO Jim Farley, it's because Ford is "getting out of the boring-car business and into the iconic-vehicle business." In a recent interview with Britain's CAR magazine, Farley acknowledged that these cars were "loved by a lot of customers." Despite their popularity, he believes it's not financially viable to invest further in models like the Fiesta, Focus, and Mondeo, especially when compared to commercial vehicles.
Unfortunately, there are no direct replacements planned for these models. Instead, Ford aims to shift its focus with a couple of Volkswagen-based electric SUVs. The Explorer and Capri, which are built on the MEB platform, are closely related to the ID.4 and ID.5, respectively. Additionally, the highly successful Puma crossover is set to receive an all-electric variant. Despite these electrification efforts, Ford of Europe has recently retreated from its plan to go fully electric by 2030.
Farley's reference to "iconic" vehicles includes models like the Bronco, Mustang, and Raptor. The Mustang, in particular, gives Ford the confidence to "take on Porsche with Mustang." To achieve this, the company plans to invest more heavily in its future. The hardcore GTD is a testament to this strategy. According to the top brass, enthusiast vehicles have traditionally been a "side business" that was never fully funded, but now they are becoming a core part of Ford's operations.
However, by phasing out these "boring" cars, Ford is putting competitors like Volkswagen Group, Toyota, Stellantis, and Kia/Hyundai in a favorable position, as they continue to produce regular cars. As previously reported, Ford's sales in Europe are declining. Through June, sales have dropped by 16.9% in the European Union, EFTA, and the UK, causing a decline in market share from 4.1% to 3.3%. In the first half of 2024, the three best-selling models in Europe were not SUVs. By limiting its passenger car lineup to the Puma, Kuga, Mustang Mach-E, a couple of VW-related EVs, and the Mustang, which will likely remain a niche product, Ford is taking a significant risk. The Focus, which was produced at the Saarlouis plant in Germany, will cease production next year.
While sales are important, profit margins are another matter. The decision to not offer a "boring" car and allow competitors to capture that demand remains perplexing.
