Ford plans return to subcompact automobile market
Posted by: in Companies Competitive StrategyFiled under: Products and services, Competitive strategy, Ford Motor (F)
Ford Motor Co. (NYSE: F), which saw a deplorable 2007 in terms of sales and profit in the U.S. and in many overseas markets as well, wants to become relevant to the consumer’s need once again. As such, the Detroit automaker would like to switch gears from SUVs and trucks and make what a growing number of consumers want: subcompact cars.
Toyota Motor Co. (NYSE: TM) and Honda Motor Co. (NYSE: HMC) have had many varieties of subcompact vehicles in the American market for years and have reaped a good deal of sales success due to that. Ford’s decade-long absence in this market will now cease as it finally wakes up to try and take away share from rivals. At the same time, it will also be answering what many consumers have clamored for since gas prices went (and stayed) above $2.00 a gallon: more fuel-efficient cars.
Ford’s new Verve subcompact sedan has a high-tech feel and a neat overall red-colored fit and finish that should hit U.S. showrooms by 2010 (a few years too late). It will appeal to younger customers who are eco-conscious but still seek a very svelte and sexy sedan at the same time. Ford CEO Alan Mulally is betting that Ford can turn its past away and jump right back into the subcompact market — one that’s here to stay thanks to big oil. If Ford can anticipate changing consumer tastes and respond in its factories within a respectable timeframe, it might just be on track to meet its Way Forward goals after all.
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