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Ford Adjusts to Gas Prices, Cuts Back on Production of SUVs

by Andrew Posner, Providence, Rhode Island on 06.22.08
Cars & Transportation

ford f150 image

Ford Responds to Changing Market
"We view the move to smaller, more fuel-efficient vehicles as permanent, and we are responding to customer demand." When the CEO of Ford makes a statement like that, you know that high gas prices have really had an effect on the economy. Not only is Ford aware of the need to respond to changing customer demand, it is also acting on that by delaying the launch of its new F-150 pick up truck, producing "90,000 fewer pick ups and SUVs in the second half of the year than it originally planned," and preparing to make more compact, efficient cars like the Ford Focus and Escape.

F-150 Pickup Truck Loses Popularity
The F-150 has been America's top-selling vehicle for over two decades, but industry insiders believe that the Civic will take over that title this year. To give a sense of just how strong the trend toward efficient cars has gone, the average car in the U.S. sells in 57 days, while "the Toyota Prius hybrid sells in just four." Honda, Nissan and Toyota are well-positioned to take advantage of the current market; Ford continues losing money and it remains to be seen how well it responds.

Via: ::Telegraph.co.uk

More On Gas Prices
::More Motorists Running Out of Gas
::Even Cheney Thinks Gas Tax Holiday is a Bad Idea
::Graphic of the Day: Americans Driving Less

More on Compact Cars
::Compact and Hybrid Cars Becoming More Popular in the USA
::Smart Car: How Smart is It?
::Sales of Hybrid S.U.V.s Lower Than Expected
::Toyota Prius Hybrid: 1 Million Served

Comments (10)

"the average car in the U.S. sells in 57 days, while "the Toyota Prius hybrid sells in just four."

This explains what is wrong with the car market, and just why the automakers are in trouble.

People want the "green choice" and the shift to green is gaining speed.
After all, why bring up children if you destroy the world they will inherit?

jump to top John Taylor [TypeKey Profile Page] says:

If Ford had chosen to continue with the production
of electric cars instead of switching to SUV's in the
first place, they would be dominating the market right
now.

jump to top publikwerker says:

I have noticed that local car dealers here in Erie PA are giving unbelievable deals on SUV's - obviously because of the gas prices, I wonder if they will ever recover and get back to the norm? probably not.

jump to top Loren says:

Here in Canada, GM shut down the plant that was building large trucks and SUV's that supply the US and Canadian markets, after just reaching a deal with the union.

This plant is a newer, modular plant and has the ability to switch the types of vehicles it makes.. Which is why the Union is flabergasted.

The may decide, and have talked aboutm changing the types of vehicles they produce there to hybrids and electrics.Remains to be seen if they will though.

jump to top Anonymous says:

Cars are the problem, and yet some how people have this notion that they are the solution.

I will enjoy seeing the collapse of the American Auto Industry, they are getting what they deserve, but it is the Japanese Autot makers that are doing the most to perpetuate this pipe dream of "sustainability brought upon by effecienty cars."

I guess this is short term, and it is better than nothing, but the truth is nothing beats forward urban planning.

jump to top Hann says:

"After all, why bring up children if you destroy the world they will inherit?"
That is exactly right, with one caveat: we never inherit the world from our parents, we only borrow it from our children. Can't remember who said that...

"Cars are the problem, and yet some how people have this notion that they are the solution."
Not at all. Anyone who has thought about the problem knows that when both options are available, rail is better than wheels, and bikes are more sustainable than cars. We have, indeed, neglected urban planning of this sort for far too long. But cars do fill an important set of niches in transportation: they can go more places more freely than trains, and they can go farther distances or transport older people or children or less able bodied people than bikes. As such they will not disappear, at least not for a long long time.

But cars have another not-to-be-neglected property: they are symbols. Car ownership is, around the world, a symbol of wealth , power, prestige, and freedom. In China, among teenagers, everywhere, what you drive has a strong effect on your status and vice versa. So making efficient and clean cars visible, bringing them into the public eye, getting them on the road and in the hands of people from regular folk like us up through celebrities, will be incredibly valuable for its symbolic effect. It can make being green and thinking about the environment cool, sexy, obligatory, or normal, whichever you wish.

jump to top Anthony [TypeKey Profile Page] says:

I say screw'em. It is their own dam fault for continuously building and marketing cars to the dumb people who live in the suburbs and actually believe that they nned a SUV or pick-up truck in their driveway. Who really needs cars that can go off road, haul tons of crap that is bought at a costco or Sams club all the while everyone gets fatter and fatter and needs bigger and bigger vehicles.

We are paying the price for our sense of entitlement thinking that we are will always have the top pick of the world's resources.

My parents had a micro Mazda station wagon back in the 70's and their were 3 of us in the back seat. So when I read or hear of some suburban mother saying she needs her SUV I want to slap her in the face and make her realize that she is just buying into the marketing that the car manufacturers spew in the ads on the TV.

We should be demanding more public transportation and actually holding our elected representatives responsible for everything that is happening today

jump to top kate says:

"Ford Adjusts to Gas Prices, Cuts Back on Production of SUVs"... while i understand the F-150 truck was Ford's most popular, why did it take so long to cut back on the SUV production? Outside the US, Ford makes a large selection of small, fuel efficient and diesel cars (take the Modeo in Europe for example).

Why don't the US car makers quit crying a river and closing plants, and just ramp up production of the other fuel effiecient cars? They could maintain a market share and at least START going in the right direction, instead of hanging onto the old "bigger is better" mentality and end in financial ruin?

Cheers,
tom-tom

jump to top tom-tom says:

"If Ford had chosen to continue with the production
of electric cars instead of switching to SUV's in the first place, they would be dominating the market right now."

But they would have lost out on tens-of-billions of dollars from those SUV's. The electrics that they built were at a huge loss, and electric cars are still not quite profitable.

"Why don't the US car makers quit crying a river and closing plants, and just ramp up production of the other fuel effiecient cars?"

It takes years of planning and work and a lot of money to "just ramp up production of other" vehicles, and it is especially difficult if the new vehicle is unprofitable. For the domestic manufacturers whose costs are higher than foreign manufacturers, small cars yeild little to no profit. Some small cars are even sold at a loss. A decade plus of cheap fuel devalued efficient cars in the US while the cost to build them here, especially with union labor, continued to increase. Larger, more expensive vehicles are the only source of profit for them. It is difficult to justify investment for which they may get no return.

It doesn't help them or us when they are villified by environmentalists. GM and Ford both have small, efficient products as well as the large, inefficient ones (Chrysler has an entirely different set of problems), but throwing stones at them on green forums drives potential buyers of their efficient products away, forcing the manufacturers to further reduce their pricing to move the product, making it even more difficult for them to justify investing in those products.

Long term, the increasing price of fuel should drive up the price of smaller cars, and high profile green vehicles like the Volt may help their image among green buyers, making greener vehicles more feasible for US auto makers, but short term as fuel prices increas and sales of the large vehicles decrease and rates no one predicted, the domestics are bleeding.

jump to top gl says:

gl, thanks for posting that. Most people do not understand how the auto industry works, then they get pissed because they think the auto makers are out of touch.

"Here in Canada, GM shut down the plant that was building large trucks and SUV's that supply the US and Canadian markets, after just reaching a deal with the union."

GM hasn't shut down the plant yet, it will still be open for about another year. I don't get it, I expected you people to be happy that SUV production is being significant cut back.

jump to top Froggy says:

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