Over the past couple of years, Ford CEO Jim Farley has clearly outlined the automaker’s future direction, and it’s one that will include a rather sharp shift toward electrification. However, FoMoCo isn’t exiting the ICE business anytime soon, but does plan on reinventing that lineup by focusing on passion brands and exiting slow-selling or low-margin segments, much in the way it stopped selling sedans in the U.S. years ago. However, the Ford CEO provided even more clarity on this matter during the automaker’s recent earnings call by noting that The Blue Oval won’t be making and selling ICE-powered two-row crossovers in the future, too.
“So I’m very optimistic about our eight percent because we are not going to be playing in the two-row commodity crossover market because that’s – because Ford’s tried that in the ICE business and it didn’t really work out for us,” Farley said when asked about the company’s profit margin target. “We want to play our hand, our strength, commercial, truck, larger vehicles on the category side.”
These comments make quite a bit of sense given the fact that Farley previously stated that the Ford Escape is facing cancellation, while a recently released product road map shows the ICE crossover being replaced by an all-electric version in 2026. Additionally, as Ford Authority reported over a year ago, both the Ford Edge and Lincoln Nautilus are set to be discontinued after the 2023 model year.
Meanwhile, all-electric versions of both the Ford Explorer and Lincoln Aviator are slated to replace Edge and Nautilus production at the Oakville Assembly plant in Canada. Regardless, at least until the second-generation Ford EV models launch, the automaker’s electrified vehicles aren’t expected to be profitable – nor look just like their ICE counterparts, either. However, in Europe – where Ford expects to transform its entire passenger vehicle lineup to EVs by 2030 – the Kuga and Puma are expected to be the automaker’s last ICE-powered models in that region.
We’ll have more on the future of Ford’s lineup soon, so be sure and subscribe to Ford Authority for 24/7 Ford news coverage.
Comments
So if Ford cannot compete in the market it just going to tuck tale and run. So they will have only expensive oversized vehicles to sell. So anyone shoping in about 70 percent of the market will not need to visit a Ford lot because they will not have anything for them. So Ford is not going to be a full line manufacturer anymore. This thinking will drive Ford out of business because people do not like to cross shop. Since Ford will no longer have a full line up of vehicles people will shop else where. So when Ford can no longer handle the truck market what will they do then I guess close shop and go home.
Nonsense.
People cross shop all the time, that’s why we have a thing called cross shopping.
Being a full line maker serving all segments that one ever served, even those that were shrinking, is like treading water and it was killing Ford.
Only a dumb company tries to have the bridal dance on every wedding.
“Exiting slow-selling and low-margin segments” means RUNNING AWAY FROM THE COMPETITION. Ford exited the sedan business because it said the market moved to SUVs/CUVs. But now it is exiting the CUV segments. Ford is running to extinction.
I like compact or mid-size vehicles that are fuel efficient, package efficient, comfortable, trouble-free, and can take me 1200 miles in 18 hours or less. Ford has nothing for the heart of the market. Henry must be rolling over in his grave.
I was considering an Escape hybrid (not PHEV as its fuel tank is too small for the long trips), but Escape’s quality sucks and the hybrid now only comes with a vinyl interior. I could see myself in a Corsair, but there is no regular hybrid… just a PHEV with a puny fuel tank and insane price premium. So, after over 45 years of Ford vehicle ownership and over 125,000 hours of faithfully working for Ford, I will have to shift to a Hyundai, Kia, Honda, or GM for our vehicles.
I recall when the Ford brand had 5 nameplates in the top 10 sales chart. Now, Ford has one. Congratulations to Jim and Jim and their RWFA shill for chasing hundreds of thousands of customers away (yes, sarcasm).
LoL. I used to think you might actually be a real Ford retiree but you went full gonzo on using the K-streeters’ scripted talking points.
Shill, no, just calling out the trolls and the bullschmitters with bad faith hidden agendas and laughing at their transparency, strawmen, portable goalposts, and having a blast debunking the poor quality drive by scripted commentary of the troll teams.
Ps good article in Auto News Europe on Ford’s exiting the car biz in Europe and its reasons for doing so:
europe.autonews. com/automakers/why-ford-dropping-fiesta-focus-europe
totally agree with your statement. i have been a drew ford (now penske) loyalist since the mid 70’s and have purchased 7 new vehicles from them. Now ford is saying they will be switching to internet sales only in the near future. I would not buy a vehicle without a test drive and don’t get me started on the cost to ship a vehicle as we all know the truth about this being a profit margin tool. looking towards Ram or maybe even Toyota for my next truck. Good luck in the future with the crazy high prices,
Where did Ford say you couldn’t test drive vehicles before purchase?
And my god, how old are you? (My late 1920’s MY dad bought my early 1930’s MY mom’s Chevy Wagon From Mr Penske in the mid 70’s. Dad’s been gone decades now and mom’s in her 90’s.)
Dad would have been chuffed at the prospect of no haggle ordering because in his later years he hated dealing with dealer sales personnel and their trickery.
If you’ve been buying cars as long as you claim, then destination charge shouldn’t be a new thing for you because it’s been standard practice for most of the auto age.
Oh oh now pushing Ram and Toyota, not the double down on “refusing to bend the knee to BEV” rhetoric but close.
I agree. These aren’t slow selling segments that they are exiting. They are high volume segments. The compact SUV segment is one of the most popular behind full size trucks. This Escape has been a total flop and I think it’s been such a loss for them that they are just giving up. I think Ford is going bankrupt by the end of the decade.
The Bronco Sport and Maverick ate the Escapes business. It makes sense to cancel the Escape.
Ford won’t go bankrupt, they aren’t short sited like many on here are. People freak out when something is canceled…people don’t like change.
They are switching to EVs, not leaving the market.
Drew, I agree 100%. I’ve been driving Fords since my 1988 Mustang LX Convertible.
I drove Explorers through the 2000’s, in 2018 I wanted a sedan for everyday driving.
The “Exiting slow-selling and low-margin segments” implementation, has driven me out of the Ford family. This is not a successful practice for customer retention.
I now drive a Tesla, and couldn’t be happier. When a customer drives another car and truly likes it better, there is little chance of them switching back again. That’s how to drive a lifelong customer away.
Ford is a dumb company.
Based on the quality of commentary, Cigna appears to have an intimate relationship with dumb.
… remember kids, always, always, begin your sentences with “So”. Be hip, it’s cool!
.
Um, they haven’t sold sedans in years, they haven’t been a “full line manufacturer” since then.
Besides, it’s a low selling segment, not 70% of the market.
Agree! Jim Farley needs to just go away before he hurts this company any further with his lackluster ideas..
Lackluster? What are you even talking about?
I believe Farley needs to go he is following government ways and means and not listening to loyal ford customers … electric vehicles might be a future down the road not being shoved down our throat
Many well stated points. What he really means is that the profit margins aren’t high enough for those products. Some other manufacturer will fill that void. Bovine excrement. Not keen on full electrification either. Look at Cali.
What about Cali? They are doing fine with their transition into BEV.
I think that Mazda will replace all Ford models in the close future. The prices are lower and the overall construction is much better! Ford will go down with their bigger vehicules.
However I am very satisfy with my Hybride Titanium Escape 2022!
One of the biggest mistakes Ford ever made was to end it’s relationship with Mazda. Their very reliable, fun to drive, nicely styled vehicles are everything Ford is not, at the moment.
Ford shed all its agglomerated brands in order to survive the looming Great Recession. Had they not done that then they likely wouldn’t be in business today.
You’re thinking more of the Volvo/Jag/Aston/Land Rover stuff, shedding those was the right decision.
But the Mazda relationship was very different. It was highly technical with Mazda DNA underpinning some of Ford’s most successful vehicles, like Fusion, Escape, Fiesta, not to mention 4 cylinder engines. The Mazda engineering team punches well above its weight and was particularly good with smaller vehicles, something Ford has completely failed to replicate after the separation. And trimming the European team, with the only remaining Ford small vehicle capabilities, makes the problem worse.
That’s the real reason Ford is exiting smaller vehicles, they just don’t know how to do it right anymore.
I agree about how good the Mazda boys are. (You mention Escape, and I agree it was good. The U204 was likely far better than the U187 ever would have been.)
I made a number of good friends during my time there and have a stack of business cards to show for it.
Each of those brands contributed something to Ford (things like FMEA were popular within the Mazda supply base before they were standard practice at Ford), Ford also contributed a lot of structure and processes to those captives in return.
Ford’s problem was in allocating capital and resources to so many captives. I never figured out why they flopped at that as some companies like VW have pulled it off but PAG + MC were a bridge too far for Dearborn.
I do agree about punch above weight and that Mazda might have been the partner with the most to contribute to a slimmed down Ford.
But when the decision was made to circle the wagons, it was decided to circle them so tightly as to not include Mazda. (This could have been because Ford was focussed on cash preservation, perhaps it was required by the loan’s terms, maybe Dearborn was over confident about FoE being able to engineer better cars than Hiroshima. Maybe a little bit of both.)
Mazda is one bad year away from going belly up.
Mazda? Mazda is barely around anymore, their sales have tanked.
Full electric vehicules will never be the solution to replace gaz models.
Similar wrong things said generations ago: “a shaking sputtering flivver will never replace a horse.”
Your statement shows an ignorance that fails to inform both historical perspective and forward vision.
…. gosh, you’re brilliant. You need a blog, hairbun.
Oh poor K-street Scotty with the witty repartee.
Hairbun, hahahaha that’s really funny.
Can’t wait for your next sputterance.
—
Ps to JDE below:
your fulmination is a sight to behold.
Pray tell what is this secret derogatory term that even I am unaware of?
Do you mean K-street? I’m pretty much aware that it is the home base for the ka-ching deep pocket lobbying groups in DC. The same groups who are making an over-represented presence on this site spreading their disinfo and FUD.
Or do you mean Big Oil???
Or short sellers???
Or pumping the “Toyota’s refused EVs and is doing great!” counter factual theme???
Troll team’s motivation doesn’t really matter it’s all in bad faith.
It’s still unclear who the troll team are working for but I must be hitting pretty close to home to have you in such a fizzy state; could it be that I’m wrecking your disinfo party by debunking your bunk?)
And as for lame, ending with “Ok Boomer”, I mean really what is more representative of a lame brain than that??
so lame, anytime you do not agree you attempt to place an ages old reference to a derogatory term that means something different than you seem to think it does.
OK Boomer
finally someone else I agree with regarding future fuels. Lookout all electric, Hydrogen is on your tale! all that we need is a safe way to handle it without blowing up.
Hydrogen? For most applications a lousy alternative to BEV.
Undesired massive thermal energy release isn’t really the biggest reason among the many reasons why H2 rather sucks as a propellant.
Hybrids are affordable vehicles for nearly everyone. Some variants of gas vehicles
Should remain in the mix or Ford will be giving sales away to Hyundai/Kia , Toyota and Subaru. Styling is the real issue/ challenge with Ford as well as Quality Control.
Seems they test in a vacuum tube! The current slate of vehicle’s have had numerous recalls. I have a 2013 Ford Escape and it has been recalled 15 times.
If you want customer loyalty build quality and affordable vehicles, $80000 Pickups and EV,s will limit your marketplace. Every Brand has had issues since 2019 but if
All Brands do not respond soon Customers will Totally disappear. Between price increases, quality control issues and Dealers price gouging I can wait , the vehicles will start to fill the lots and they will start to respond in kind with huge discounts!
Well the well reasoned theory above pretty much explains it: it’s either all customer capture, or all customer rapture !
The Ford Edge and the Lincoln Nautilus have been 2 of the best quality vehicles that Ford makes according to Consumer Reports and has sold well till news came out that they were discontinued after the 2023 model year. The Escape is much less money than a Mach E and is about the same size, make no sense to remove a model that outsells the Mach E by a large margin that more people can afford. There are plenty of Lemon Law Mach Es showing up on Cars dot com, people complaing of no heat, short winter range, service issues, computer issues and can’t get the snow and ice off the vehicle as there is no engine that creates heat.
Escape was specifically cited by Ford as an example of a profitless prosperity segment vehicle that was just competing on price.
Nautilus and Edge didn’t stop selling because news they were being discontinued, that happened because they were in a declining segment and if you are going to sell them at a profit you will face declining volumes.
(Gee wiz, how is it that all these experts don’t know these things?)
Jimmy needs to go!!
Big sniffing gas Steve is having another vision, please seek shelter!
GM still has Malibu and CT4/CT5. Fusion/MKZ could have survived.
If you only ever copy the moves of your competitors you will never be a leader.
You guys crack me up … Ford was brilliant to enter segments and make money as they grew but now armchair experts without granular market trend data think Ford is not brilliant to exit shrinking and money burning segments (so they can enter different new, growing and more profitable segments).
For a Ford loyalist for 50 years, the present and future models fall way short of our expectations….BUT, the Fix or Repair Daily has been around a long time!
I find it not only incongruous, but highly implausible that “a 50 year Ford loyalist” would refer to Ford like that.
Such a pairing of excessive cognitive dissonance and absence of confirmation bias sends the big honking BS detector off the scale man.
.. you’re so obsequious, you make Greta Thornburg entertaining.
We now know what Big Oil’s K-street BScott both fetishizes and fears, a little girl.
Yes, I suppose Big Oil wees down both pant legs at the thought of people realizing that the girl ain’t wrong.
To think people will be able to afford a ev at the prices they demand is ridiculous I know I can’t afford one so I guess I’ll be living in a modern day cuba and keep fixing the car I own now till I can’t anymore
LoL Oh Bill, stop being so melodramatic.
The prices will come down as the production volumes increase and the competition heats up.
If you were not hibernating, you might have already seen this with both Tesla and Ford price cuts. That’s not the end of that trend.
When we started our young family we were partial to Ford products and they had models we could afford. Those purchases solidified our brand loyalty for the past 30+ years. Now we can afford the other, more expensive models and we do have them. The price points of Ford vehicles today, without the Edge or any sedan models, will be out of reach for many. Sure, we all know the Explorer, Bronco and F-Series bring in serious profits and they made it clear that is where their interest lies, not in building the American family. Sad to see.
Ford went from building the better mousetrap and having a path besten to its door to trying to be all things to all segments and losing money on some it should have exited sooner (some, like small cars it had to stay in to satisfy CAFE regulations.)
But Ford also saw how the Tesla mousetrap was amazingly successful as Ford struggled with low margin cars and shrinking segments and realized the future looked more like Tesla than like Ford of the last 50 years.
I’ve been driving fords for 45 yrs but this Grandma will probably be looking for another Model mid size two row suv when my edge lease is up. Possibly GMC, Chevy or Mazda. I couldn’t even get a car seat in back of the escape without pushing front seats all the way forward. I have no problem entertaining a Hybrid model Ford but not an all EV.
My late husband retired from Ford and he’d be rolling in his grave today over the decisions Ford is making.
LoL come for the granny Facebook-style sock puppetry but stay for the rolling grave ending. BS detected.
I guess I’ll give Toyota a try they aren’t all in on that green crap they seem to be the only adults in the room
Nonsense Bill. Toyota just announced a corporate shake up because Mr Toyota slept on EV.
Those adults will be all green crap as soon as they can show off their coming corporate BEV architecture.
Until then they pay trolls that write things like you write above because at the moment they’ve got nothin’.
Please enjoy the following article (if you know how to copy and paste, please don’t forget to remove the space before com):
ft. com/content/2edc2630-a0b6-4b45-8e18-ac3917a68eed
I’ve been paying relatively close attention to Farley ever since he took the reigns of the company, and at first, his enthusiasm and participation in automotive sports seemed to be a positive, as I thought that at least some of this would transfer over into Ford products.
From this last forum post, I’m now thinking that his side interest, is just that, and that he has truly transitioned into a traditional CEO role and is just concerned with profits, keeping shareholders happy and doing whatever that takes relative to product lines to make those typical goals a reality. Unless there is a mentality and thought process to which we can only guess at, what does this new found interest in racing and motorsports, (Mustang in IMSA GT4, Formula 1 powertrain development with Red Bull, Rally Racing, etc.), translate into the afore mentioned product lines?
All the company has is the Mustang now that the Ford GT production is completed to offer as anything related to motorsports, unless off road is the only other avenue? Full size SUV’s and large commercial trucks…really?
Agreed. F1 is a bit mystifying as it seems like an abstraction of sorts.
I’m not sure what the linkage is between F1 engine building and co-branding except maybe a long play for:
a) positioning to become an engine producer for other OEM’s who decide to shutter their ICE engine development,
b) spinning off the remnants of ICE engine operations in maybe 5-15 years and buying ICE engines from that entity (like Ram does from Cummins),
c) that the upper layers of the demographic who like Red Bull excitement and F1 would just like to have a Ford branded vehicle and the benefits of pulling them in outweigh the expense of F1 participation (sometimes it’s just that simple too, because F1 reaches a tremendously large global audience possibly one that the other racing classes barely touch.)
It’s clear to me that Ford’s quasi return to a Total Performance level of racing patronage is built neither on (indulging Farley’s private) passions nor (Ford v Ferrari) grudges, Ford’s not rich enough for that, it’s because spending money here reaches a bigger audience than much advertising does and is something they think will advance the brand.
A big reason Ford can’t tolerate lower margin vehicles is not only because their cost structures are out of wack, but they need to free up the plants to make thew new products that are in profitable growth segments. Ford’s strength is that they are strong players in the most profitable segments in the business, other car companies only have the “commodity” segments and have to win by volume over margins. I’m sure they would give that all up if they could have F-150, Bronco, Expedition, Explorer, Maverick, Bronco Sport, etc. Much like Stellantis, Ford has to think differently and chose what it can make. I don’t think Ford wants to be rid of the Edge, but they need the plant and CA$ to invest into a key EV segment that is currently under-serviced (3-Row Crossover). Crossovers are the first to move to EVs so it makes sense to get out ahead of it instead of spending anymore money on ICE, only to see ongoing volume and profit erosion favoring EVs. Just look at the Model Y, it outsells every Ford except for the F-Series, by a significant margin. Anyway, Ford has prepped for this by making Maverick and Bronco Sport. The only problem is that Ford won’t have an affordable EV like the Equinox for attest 5 years which makes leaving those segments much harder.
Agreed. Really good summary.
These are essentially the things Farley has been transparently saying for a couple years now; the rest takes a bit of thinking and analysis to intelligently put together as you did here.
I do think, however, the 5 year horizon you state at the end will be more like 2-3 years.
I said it a long time Farley is an idiot he needs to go wake up somebody in The ford family before he totally ruins Ford Motor Co.
Dude, you can’t even use proper punctuation; I’m not sure it’s a good idea to go around calling others idiots.
What Farley needs to learn is Ford has a habit of discontinuing models…..even models that sell well….he seems to focus on the Nest Future Customer…who seemly is not there…..while disregarding the existing customer..needs…..if he focus of Quality ..it been a win win…Ford losing money not because of two row Suvs….its losing money because of two or more recalls…he should be opening a Quality Control Center..now….Ford paid out over $5 million dollars in warranty related and recalls….this has to stop….he seems to think hit just hurting Ford…..its hurting his customer base…..Fixing Quality will be his most important thing he be judged on….not EVS….which may be his undoing….I like Farley…but he seems to not see the forest for the trees
Your comments betray the fact that you seem to think that only one thing can be done at a time or that one activity is responsible for the results in another.
That’s not how complex things generally work.
Terrible move. Farley is going to run Ford into the ground trying to appease his EV fetish. The marketplace doesn’t want EVs yet. Until then, make what people want. Sandy Munroe doesn’t represent the marketplace.
LoL market clearly wants EV’s, what are you even talking about.
Ps it’s Munro, and why do you invoke him? I saw someone else here previously similarly slamming Munro and have to wonder what’s behind it.
I’ve worked in Ford service for a long time. And I will continue to for a long time. Why? Because no company produces more of the $hittiest vehicles on the planet. Nothing makes me smile more than the Monday morning line of flatbeds in my lot waiting to drop off basically brand new vehicles.
Whether Farley is making these decisions on his own or consulting with his board of directors, he’s doing a poor job as CEO either way. Their portfolio of vehicles is shrinking fast and not everyone is going to buy into his EV strategy. Ford needs a new strategy and leadership or I’m afraid that they will end up like how GM and Chrysler did back in 2008.
Oh John, don’t look at things so dire. Take a look at my reply to your comment in the recent thread about the Edge.
Farley’s brilliant ideas are music to all the other automakers. This company is excellent at making mistakes and being the industry’s leader in recalls.
LoL. You cite problems brewed in the past to condemn actions taken in the present to position for the future.
Your summary analysis is lousy.
Cigna he agrees and everyone sees it except Farley and RWFA who acts like a barking corporate bulldog
Bow wow wow yippee kai yea M(y)F(fiend)!!
But more seriously, maybe you see me like like that, but I’m definitely not in anyway related to or invested in Ford; I just got a thing against disinfo and a fetish for goring the bad faith K-street troll team by piercing their FUDster balloons with fact and experience.
Ford needs fresh blood. It missed a chance to position itself on sedans market and now Honda, Hyundai, Nissan and Mazda took over that segment. All they had to do is to hire some German car engineer who knows to project full size sedan without cheap/ugly details. Ford Taurus was really close to be full blooded American sedan but it needed more professional design. Most of Ford products that are discontinued or gonna be are looking like unfinished products. It’s lame, without clear concept, blurred, generic. Honda, Hyundai, Mazda, Nissan are boring cars but fully developed and they are making sense in that segment and price range. Ford has to find serious guy, who’s gonna develop real American sedan. They have to be present in that segment.
RWFA – Unfortunately, reading your comments gives me the opposite impression.
People say they don’t want an EV
do you think they have that right?
they can!
and you insult them for having a different opinion.
I insult them for being paid trolls or so ignorant they regurgitate near word for word what the troll teams have laid down.
I originally did that just to keep things honest around here but in the meantime I admit It’s kinda fun.
I don’t think I ever insulted a good faith commenter saying they didn’t want an EV, in fact I have oft said that EV’s can’t cover certain special use scenarios.
Btw, what’s wrong with your sentences? Am I arguing with primitive AI (that can’t find the reply button) or just carbon based 0i?
So his plan is to exit any segment that isn’t 50k plus? That’s short sighted. While focusing on higher margin segments is smart, leaving low margin segments kills your revenues, and leaves a large profit gap, because margins come down in segments naturally.
Those high margin segments are also high risk, when demand drops due to high interest rates, a poor economy, etc… You’re dead in the water if all you offer is expensive high margin product.