They Have Made this Error Before

Repeating the short-sighted decisions made by US auto makers the last time gas prices were Ford has decided the future is trucks and SUVs, and so will be abandoning conventional passenger cars.

Sounds like the, “Small cars equal small profits,” mentality that nearly destroyed auto makers in the 1970s and again in the 1990s, after oil prices spiked:

Ford Motor Co. said Wednesday it will stop investing in sedans in North America, bowing to U.S. drivers’ seemingly never-ending zest for crossovers and pickup trucks.

Ford  shifted focus on “building a winning portfolio” of vehicles, by which it meant no more of its slow-selling sedans at least for North America.

U.S. drivers have gravitated to SUVs and pickup trucks for years, thanks in part to these vehicles’ relative fuel economy improvements and price drops. Many car buyers also report enjoying the high-riding seating position of an SUV or pickup truck.

“Ford realized it can’t be everything to everyone, and in today’s market that could be OK,” said Jessica Caldwell, an analyst with Edmunds. “The key to success is focusing on where your customers are and where your strengths lie, and for Ford doubling down on trucks and SUVs could be just what the brand needs.”

The move isn’t without risk, however. Ford is willingly alienating some of its car owners and conceding market share in segments that, while declining, are still relevant to some buyers, she said.

When, and it’s always when, gasoline prices spike again, those people trading in Ford trucks and SUVs for more efficient vehicles will not be able to find those new vehicles at their Ford dealer, and so loyal customers will go somewhere else.

They are repeat their historical mistakes, over, and over, and over, and over again.

Leave a Reply