U.S. sales figures to the contrary, Ford can sell lots of small, efficient cars
Yesterday we mentioned Ford's (and GM's and Chrysler's) declining domestic sales figures for May. The theory for the Big Three's inability to increase sales is that fuel-efficient Japanese cars are winning over customers. Well, if the market wants smaller, fuel-efficient cars, then Ford is willing to deliver. In Brazil, at least.
Brazil, as many readers will already know, uses a lot of ethanol. Even "regular" gasoline there is 25 percent ethanol and more than 75 percent of all vehicles sold in Brazil are flexible fuel vehicles. According to Paddock Talk, Ford of Brazil introduced its first flexible fuel vehicle, the Ford Fiesta, in 2004. Barry Engle, Ford of Brazil's president, said it was "a huge hit." Today, Ford of Brazil offers three high-volume flexible fuel vehicles: the Fiesta sedan, the Fiesta hatchback, and the Ford EcoSport. Now, because of customer demand Ford of Brazil is set to introduce a flex-fuel Fiesta with a small 1-liter engine. One-liter engines are the most popular engine types in Brazil. If Ford can give consumers the small cars they want in Brazil, perhaps Ford will be able to do the same in America some day.
[Source: Paddock Talk]
Reader Comments (Page 1 of 1)
Charles S 1:50PM (6/06/2006)
All those listed are Brazil's Ford subcompacts. While smaller Japanese cars have won the day, they are far from the old subcompacts that shared the same names. The Civics and the Corollas are now bigger than they have ever been, and they benefitted from strong brand recognition that took decades to build. Subcompacts was never that popular in the US in the 80's and was close to extinct in the 90's. Just look at the sales numbers for the Toyota Echo.
The true test for subcompacts in today's high fuel cost market will be the sales numbers for the Honda Fit and Toyota Yaris. I excluded Scion and the MINI brands because they were more of an alternative brand at their time, rather than a "category" in today's market.
I would *like* to believe that there is a market for small cars in the US, but I really don't think the trend for big cars can change overnight.
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David 9:12AM (6/07/2006)
I think that the "trend" for big cars in America cannot really be blanketed over all the different regions as different needs are required.
Also, I don't think that the Toyota Echo can really be the absolute end all of all subcompacts. The sedans that they tried to sell in America were absolutely horrendous! I think that's precisely why we should be including MINI, Scion, etc...because they create these small cars that are fuel efficient yet aren't UGLY. They actually make the desirable! The shocking thing wasn't that these cars sold, but that subcompacts around the world ALL generally look better than the Toyota Echo - yet people expected the Echo to sell.
Even with today's Yaris offerrings by Toyota USA, I'm appalled that they decided not to offer the 5-door hatch. It's quite hard to live with a 3-door hatch unless you're permanently within a town/urban center.
VW's Golf in the states is also behind. It's looked the same for so long that it's very desirable anymore. Why wasn't the international Golf introduced sooner? Same for the Ford Focus. Car mags and websites drool over the Euro Focus all the time yet Ford's never taken a clue..
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David 9:15AM (6/07/2006)
sorry
*them
*not very desirable
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Bill 9:34AM (6/07/2006)
#2 is right about one point
I don't know why the US doesn't get the 5-door Yaris. Canada got it with the last generation Echo/Yaris.
A 3-door hatch is too low-end for many people. A subcompact 4-door sedan is sort of useless in that configuration because you don't have flexibility of space. To me, a 5-door hatch is the natural configuration of most small cars.
(Mazda3 5-door owner here)
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Charles S 12:03PM (6/07/2006)
Well, I can't agree on the "category" sales on Scion and MINI because they are not sold as fuel-efficient cars, but rather brand-focused, lifestyle choices.
MINIs are not particularly fuel-efficient, and while base Scions are ok, the high volume sales of tC and other performance aftermarket parts for the smaller vehicles further reduce the overall significance of the fuel efficiency of Scion cars.
Cars like the new Fit and Yaris are, somewhat, the US counterparts for the Brazil's subcompacts listed in the post. They are the low-cost, high-mpg "Class" of cars that is meant for today's high fuel cost market.
Fuel efficiency has never been a strong selling point for most car buyers in the US. Even in today's environment, I personally don't think it'll boost the sales in any meaningful way.
What I think will happen is that the demographics will just "shift" to a different product. People who have always been comfortable with a compact car will now have more choices, and they are willing to move from a Civic to a Fit. Same goes for people who are happy with an Accord in the past, they now can consider the new Civic. However, they will never "downgrade" themselves down to a Fit. My observations on this matter is how I see the market today. The market for the largest vehicles has shrunk, because the potential buyers downsize slightly to the next biggest size. The shift continues until people finally trickle down to the smallest of cars.
Again, not that I'm down on the efforts by Honda, Toyota, and in the future, Nissan, but while I believe there is a market today for such cars, their sales will only be adequate.
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gui 11:13AM (6/08/2006)
All brands except for Honda, Toyota and luxury Europeans offer flex fueled models in the Brazilian market, not even as an option. Better yet is that they can all run on E100 to E20 (standard ethanol content in "pure" gasoline in Brazil). Displacements range from 1.0L to 2.4L, all 4 cyls. (70 to 140 HP). Due to cold starting drawbacks with E100, a gasoline container is added in the engine bay area for all flex vehicles, improving conditions, drawing gas automatically if needed and sending it to the injectors.
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