Why Ford Is Adding This New SUV To Its U.S. Lineup
Ford Motor Company (NYSE: F) is going to introduce the 2017 version of its subcompact crossover, the EcoSport, to the U.S. auto market. In 2015, the model sold close to 250,000 units in markets such as Europe, Asia and South America. The introduction of this model is part of Ford’s plan to bring four new utility vehicles to the Ford and Lincoln brands. In the article below, we discuss the U.S. auto maker’s reasons for doing so.
In a generally slow growing U.S. auto market this year, subcompact crossovers has been one of the fastest growing sub segments. The combined growth of the five highest selling models in this segment has been close to 36.6% in the year to date till November.
The EcoSport was originally introduced as an affordable SUV model in many markets such as China, Russia, Brazil, India and Thailand. Later on, a more upscale version of the model was introduced to the European market to compete with small SUVs like Opel’s Mokka in the premium segment. It is quite likely that the Ecosport will play a similar role for the company in the U.S. auto market, where its competitor is likely to be Buick’s Encore and Honda’s HR-V. Given the high potential for growth in this segment, the addition of this model to Ford’s U.S. lineup can boost its sales and improve profitability, offsetting the impact of the Brexit vote, the launch of a new Super Duty truck and the decrease in Lincoln sales in 2017.
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Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Ford Motor
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