Ford Rethinking it's Hybrid Effort According to CFO

[AM222]

On 1/8/2024 at 4:54 AM, sullynd said:

Americans equate size to value, so they’re not going to pay more for a BS than a Maverick SUV. 

Pretty much the situation between the Bronco Sport and the longer Escape. Very expensive vs expensive (by non-luxury brand standards).

A Maverick-equivalent SUV doesn't need to be a Maverick, Ford just needs a lower-priced C2-based model. 
The Corolla Cross for example is an example of a lower-priced crossover SUV positioned in the smaller-end of the compact class. Unlike the Bronco Sport, which is positioned above the Escape, the Corolla Cross is positioned below the RAV4. Ford needs something like this. 

The base Corolla Cross L costs $24,960 with destination charges, the LE variant below costs $27,290 with destination charges.
Standard engine is a 169hp 2.0-liter inline-4. The AWD 2.0-liter Hybrid version has a total system output of 196hp and starts at $29,745 with destination charges.

For comparison, the base Escape Active 1.5 EcoBoost FWD costs $31,635 with destination charges.

Edited January 10 by AM222

[Rick73]

3 hours ago, AM222 said:

A Maverick-equivalent SUV doesn't need to be a Maverick, Ford just needs a lower-priced C2-based model. 
The Corolla Cross for example is an example of a lower-priced crossover SUV positioned in the smaller-end of the compact class. Unlike the Bronco Sport, which is positioned above the Escape, the Corolla Cross is positioned below the RAV4. Ford needs something like this. 

Similarly, I’ve suggested Ford needs a smaller and more affordable BEV positioned under Mach-E in the “What happened to EVs?” thread.

 

A BEV about the size of Corolla or Corolla Cross, perhaps slightly smaller with same interior space due to BEV packaging advantage, would be large enough for mass acceptance.  Toyota also shows that many buyers, particularly in the Corolla price range, accept basic powertrains with well under 200 HP which save on initial cost and deliver greater fuel economy.  The same logic could be applied to a basic Corolla-size BEV.

[silvrsvt]

4 hours ago, AM222 said:

Pretty much the situation between the Bronco Sport and the longer Escape. Very expensive vs expensive (by non-luxury brand standards).

A Maverick-equivalent SUV doesn't need to be a Maverick, Ford just needs a lower-priced C2-based model. 
The Corolla Cross for example is an example of a lower-priced crossover SUV positioned in the smaller-end of the compact class. Unlike the Bronco Sport, which is positioned above the Escape, the Corolla Cross is positioned below the RAV4. Ford needs something like this. 

 

How much do you really want to divide the market up though?

 

The Bronco Sport is shorter overall then the Corolla Cross, costs more because it comes with AWD standard and has a Bronco "tax" attached to it.

 

I don't really see the point (if the Bronco Sport and Escape are selling well, which it looks like they are) just to add another cheaper product that will take sales away without the profit of those two products. I can see something Puma being a better fit, but like this mythical cheap C CUV, there is no place to build it in NA.

 

The Maverick is a completely different product then the other two and offers something different that they don't have, a small bed. 

 

The Average cost of a new car is almost 50K, meaning those 20K cars are becoming rarer and rarer...and automakers don't care because the more expensive products are selling well. I really don't see the point of pursing the mythical sub $25K price point-the reason it was done in the past was to make CAFE (huge numbers of Escorts and the like sold in the 1980s and 1990s at a loss)

[rmc523]

8 hours ago, AM222 said:

Pretty much the situation between the Bronco Sport and the longer Escape. Very expensive vs expensive (by non-luxury brand standards).

A Maverick-equivalent SUV doesn't need to be a Maverick, Ford just needs a lower-priced C2-based model. 
The Corolla Cross for example is an example of a lower-priced crossover SUV positioned in the smaller-end of the compact class. Unlike the Bronco Sport, which is positioned above the Escape, the Corolla Cross is positioned below the RAV4. Ford needs something like this. 

The base Corolla Cross L costs $24,960 with destination charges, the LE variant below costs $27,290 with destination charges.
Standard engine is a 169hp 2.0-liter inline-4. The AWD 2.0-liter Hybrid version has a total system output of 196hp and starts at $29,745 with destination charges.

For comparison, the base Escape Active 1.5 EcoBoost FWD costs $31,635 with destination charges.

 

Many of us have wanted Puma to come over here to fill that smaller crossover vehicle gap.  But it won't happen.

[akirby]

3 hours ago, silvrsvt said:

 

How much do you really want to divide the market up though?

 

The Bronco Sport is shorter overall then the Corolla Cross, costs more because it comes with AWD standard and has a Bronco "tax" attached to it.

 

I don't really see the point (if the Bronco Sport and Escape are selling well, which it looks like they are) just to add another cheaper product that will take sales away without the profit of those two products. I can see something Puma being a better fit, but like this mythical cheap C CUV, there is no place to build it in NA.

 

The Maverick is a completely different product then the other two and offers something different that they don't have, a small bed. 

 

The Average cost of a new car is almost 50K, meaning those 20K cars are becoming rarer and rarer...and automakers don't care because the more expensive products are selling well. I really don't see the point of pursing the mythical sub $25K price point-the reason it was done in the past was to make CAFE (huge numbers of Escorts and the like sold in the 1980s and 1990s at a loss)

I’m not saying add a 3rd product.  I’m saying that Escape sales are low compared to 2017 (300K) vs 140k last year and compared to the current competition so I think a restyle is needed to be more aggressive and I think a Maverick SUV would be slightly cheaper than Escape but could potentially yield more profit and better margins.

[silvrsvt]

19 hours ago, akirby said:

I’m not saying add a 3rd product.  I’m saying that Escape sales are low compared to 2017 (300K) vs 140k last year and compared to the current competition so I think a restyle is needed to be more aggressive and I think a Maverick SUV would be slightly cheaper than Escape but could potentially yield more profit and better margins.

 

But your getting caught up into the sale numbers game-Ford had an issue with the 2013 Escape-making a profit on it. Its pretty bad when an 2017 SEL model has more standard equipment then a 2013 Titanium Escape did. That is part of the reason why it was getting decontented at the end of its life. I'm guessing the 2020 redesign fixed that. So you now have two different products selling more then just one with a better profit. 

[akirby]

25 minutes ago, silvrsvt said:

 

But your getting caught up into the sale numbers game-Ford had an issue with the 2013 Escape-making a profit on it. Its pretty bad when an 2017 SEL model has more standard equipment then a 2013 Titanium Escape did. That is part of the reason why it was getting decontented at the end of its life. I'm guessing the 2020 redesign fixed that. So you now have two different products selling more then just one with a better profit. 

I get all that.  I just think a new top hat would improve sales and/or profitability.

[T-bird]

I drive Ford F150s and am considering a hybrid version. At this time however I am waiting to see about the Ram hybrid. I like the thought process behind it. Think Ford had better do some rethinking and consider what Ram is doing. 650 mile range and over 600 hp is impressive. 

[Rick73]

22 minutes ago, T-bird said:

I drive Ford F150s and am considering a hybrid version. At this time however I am waiting to see about the Ram hybrid. I like the thought process behind it. Think Ford had better do some rethinking and consider what Ram is doing. 650 mile range and over 600 hp is impressive. 

Are you referring to recently-announced plug-in RAM hybrid?  If so, I expect that will like be much more expensive — hard to compare directly.

[T-bird]

Yes. No dollar numbers and expect high. Won't even consider purchasing until been out a year minimum and get an idea on problems potential. Everything said about what they are coming out with is nice featured. 

[jpd80]

The more I read these threads, the more I become convinced that manufacturers like Ford

dont really know what the majority of vehicle buyers want these days and that’s because

theres so much choice.

 

Ford thought that Utilites would replace cars, they did but Ford decided to build only a few 

types and wondered why everyone else was eating their lunch……

 

The RAV4 is no great shakes but it has done more to transition Toyota car buyers that any other brand.

The fact that Toyota openly admits that most Camry buyers will probably switch to RAV4 says a lot.

Maybe one day, Ford will get a clue about the millions of buyers who don’t even consider it anymore.

[rmc523]

On 1/19/2024 at 5:05 PM, jpd80 said:

The more I read these threads, the more I become convinced that manufacturers like Ford

dont really know what the majority of vehicle buyers want these days and that’s because

theres so much choice.

 

Ford thought that Utilites would replace cars, they did but Ford decided to build only a few 

types and wondered why everyone else was eating their lunch……

 

The RAV4 is no great shakes but it has done more to transition Toyota car buyers that any other brand.

The fact that Toyota openly admits that most Camry buyers will probably switch to RAV4 says a lot.

Maybe one day, Ford will get a clue about the millions of buyers who don’t even consider it anymore.

yup, ford’s plan was

1) eliminate cars

2) shift everyone to SUVs/crossovers

3) proceed to not update/keep updated  the SUVs/crossovers in the lineup.

 

good plan lol

Edited January 21 by rmc523

[jpd80]

2 hours ago, rmc523 said:

yup, ford’s plan was

1) eliminate cars

2) shift everyone to SUVs/crossovers

3) proceed to not update/keep updated  the SUVs/crossovers in the lineup.

 

good plan lol

I get the whole idea of minimum number of plants with production right sized to true market need,

that’s a clever way of saying fewer plants and employees working harder, making only highly profitable vehicles.

The big failure of “One Ford” was that it took global vehicles too far, ignoring proper regional tailoring as well as

the opportunity to use multiple vehicles/sales channels to deliver higher profits by reaching more customers.

America is a treasure trove of niche customers - all they want is to be given vehicles that fill that need and it’s $$$$.

 

The stripped down minimalist view of the auto industry is looking through the accountants eyes,

it misses everything that makes Ford buyers pay premiums for vehicles that stands out from the competition.

Maverick showed how quickly Ford could get a desirable vehicle to market  when it ignored out of date research to the contrary. Rowing against the tide and actually  making vehicles that are different to all the

“vanilla” competition is the right path, they just don’t see it yet.

 

Ford took its eyes off the market when it went after BEVs 100% drawing $11 billion out of ICE programs

and sending its most experienced engineering teams down the road. Ford has no plan B, current changes

are only aimed at stemming the bleeding, it’s just fortunate that Bronco, Ranger and F150 are still strong

enough to pick up the slack

Edited January 21 by jpd80

[Rick73]

3 hours ago, jpd80 said:

The stripped down minimalist view of the auto industry is looking through the accountants eyes,

it misses everything that makes Ford buyers pay premiums for vehicles that stands out from the competition.

Maverick showed how quickly Ford could get a desirable vehicle to market  when it ignored out of date research to the contrary. Rowing against the tide and actually  making vehicles that are different to all the

“vanilla” competition is the right path, they just don’t see it yet.

Not that accountants necessarily made Maverick more affordable, but isn’t Maverick somewhat minimalist and utilitarian which helps keep costs low?  The low cost must make Maverick even more “desirable” to some buyers.

 

I would like to see an even lower cost base variant with 2.3L NA engine, FWD, and 8-speed auto.  AutoWeek this morning reviewed a 2024 Kia Seltos which reminded me of this general subject (for clarity — I’m NOT comparing Maverick to Seltos).

 

Anyway, the lower-cost base Kia Seltos with 2.0L NA FWD gets better fuel economy than the higher-cost optional 1.6L Turbo.  The Turbo has more power and is faster, but the base unit costs less and is more economical.  Ford could do the same with Maverick by offering an even lower cost Maverick which could appeal to those on tight budget or don’t drive enough to justify the higher-cost hybrid.

[jpd80]

2 hours ago, Rick73 said:

Not that accountants necessarily made Maverick more affordable, but isn’t Maverick somewhat minimalist and utilitarian which helps keep costs low?  The low cost must make Maverick even more “desirable” to some buyers.

The point I was making was the short development time which reduced project overhead costs. Yes it is a bit minimalist in lower trims but yeah, that’s the point, know your buyers,

 

Quote

 

I would like to see an even lower cost base variant with 2.3L NA engine, FWD, and 8-speed auto.  AutoWeek this morning reviewed a 2024 Kia Seltos which reminded me of this general subject (for clarity — I’m NOT comparing Maverick to Seltos).

That 2.3 N and 8AT is a combination and ECU calibration not shared in any of the C2 product envelope or it’s field reliability tests, so that’s at least another $250 million minimum that has to be paid for. Sometimes it’s just simpler lower cost to just carry over power setups and tunes from other similar vehicles.

 

Quote

Anyway, the lower-cost base Kia Seltos with 2.0L NA FWD gets better fuel economy than the higher-cost optional 1.6L Turbo.  The Turbo has more power and is faster, but the base unit costs less and is more economical.  Ford could do the same with Maverick by offering an even lower cost Maverick which could appeal to those on tight budget or don’t drive enough to justify the higher-cost hybrid.

Short answer is that Ford don’t need to sell an even lower priced Maverick

 

The sell with the 1.6 T Seltos is the power rush, any salesman will tell you that it’s easier to upsell HP than it is to sell fuel economy. It’s just the way consumers brains are wired, the old better fuel economy should be baked in for free attitude.

 

When Ford can’t make enough Mavericks for a hungry market, you’re not going to get a business for making cheaper versions to replace the more expensive build profile, it’s just not a thing.

Edited January 22 by jpd80

[Rick73]

1 hour ago, jpd80 said:

When Ford can’t make enough Mavericks for a hungry market, you’re not going to get a business for making cheaper versions to replace the more expensive build profile, it’s just not a thing.

True, as long as we don’t confuse lower costs with lower profits.  That may be the case anyway, but I’m not sure it has to be.  I’d be more worried about sales volume being too low if a FWD Maverick with 170~180 HP was offered and priced so that profit was the same as EB or Hybrid variants.  I may be guessing wrong, but shouldn’t eliminating AWD and EB lower manufacturing cost by at least $2,000 per vehicle, everything else remaining equal?

[jpd80]

5 hours ago, Rick73 said:

True, as long as we don’t confuse lower costs with lower profits.  That may be the case anyway, but I’m not sure it has to be.  I’d be more worried about sales volume being too low if a FWD Maverick with 170~180 HP was offered and priced so that profit was the same as EB or Hybrid variants.  I may be guessing wrong, but shouldn’t eliminating AWD and EB lower manufacturing cost by at least $2,000 per vehicle, everything else remaining equal?

Ford actually saved a bunch of money by reusing engines and transmissions from other C2s and the ECU tunes.

Stepping outside of established product envelope / powertrain envelope is normally not an   option to engineering teams, that’s what keeps the original project costs down and helps with forward ordering of  parts supply contracts. So most things would be locked in for a year or more to keep costs down.

Edited January 22 by jpd80

[akirby]

10 hours ago, Rick73 said:

 I may be guessing wrong, but shouldn’t eliminating AWD and EB lower manufacturing cost by at least $2,000 per vehicle, everything else remaining equal?

I think that’s way too high.  Maybe $1K and you have all those added overhead costs with crash testing and EPA certification, etc. 

The juice ain’t worth the squeeze when they can sell all they can make at higher prices.

[Rick73]

2 hours ago, akirby said:

I think that’s way too high.  Maybe $1K and you have all those added overhead costs with crash testing and EPA certification, etc. 

The juice ain’t worth the squeeze when they can sell all they can make at higher prices.

Yeah, I forgot Maverick EcoBoost is already available with FWD, so cost reduction would be limited to EB versus NA engine costs, and like jpd80 mentioned, it doesn’t appear Ford even has a FWD transverse engine available for compact vehicles.

 

I’m a strong proponent for hybrid powertrain options, but keeping an open mind, also realize that there is still a good fit for base ICE for some buyers.  With technology improving not only in BEV and Hybrid, but also ICE, a lower-cost powertrain option for buyers who drive very little, or else drive mostly on highways, may be successful.

 

Looking at costs, I was surprised that cars like new Mazda 3 are so fuel efficient already with 2.5L NA engine and 6-speed auto that incremental fuel savings for me probably would not pay for a hybrid upgrade.  I don’t drive that much around town, and if I took a long highway trip, the Mazda was tested by Car and Driver to get over 40 MPG at steady 75 MPH.  This outstanding fuel economy comes from an engine almost as efficient as Atkinson cycle, plus aerodynamic improvements that yield a Cd estimated down around 0.26 which is great for a compact ICE car.  Obviously, government regulations will likely eliminate ICE choices even when they make financial sense to buyer.

[HotRunrGuy]

13 hours ago, Rick73 said:

Looking at costs, I was surprised that cars like new Mazda 3 are so fuel efficient already with 2.5L NA engine and 6-speed auto that incremental fuel savings for me probably would not pay for a hybrid upgrade.  I don’t drive that much around town, and if I took a long highway trip, the Mazda was tested by Car and Driver to get over 40 MPG at steady 75 MPH.

 

Well, there you go. You found yourself a vehicle with a NA engine and a manual transmission, albeit one that cost more than a base Maverick. Good luck bringing that 4x8 sheet home with it though.

 

HRG

[Rick73]

10 hours ago, HotRunrGuy said:

 

Well, there you go. You found yourself a vehicle with a NA engine and a manual transmission, albeit one that cost more than a base Maverick. Good luck bringing that 4x8 sheet home with it though.

 

HRG

I have 4X8 sheets covered with my other vehicle.  ? 

 

I have recently been looking for a cost-effective “additional” vehicle to mostly drive near my home and I honestly can’t find a single choice that calls out to me.  Maverick Hybrid would be an OK choice but can’t replace my larger vehicle for camping or long touring road trips.  For now I selfishly want two vehicles to meet two very different needs rather than compromise and make do with one vehicle that doesn’t excel at either.

 

From financial standpoint, it’s really hard to justify spending much to upgrade from ICE to Hybrid if only driving around 3,000 miles annually.  Improving from 30 to 45 MPG only saves $100/year at $3.00/gallon.  That doesn’t pay for much up-front purchase cost, not to mention a hybrid battery replacement would wipe out a decade of gas savings even if I drove a lot more.  My point was that as cars/vehicles become more efficient in general, energy savings become less of a factor to total ownership costs.  Hybrids are a great idea, but costs have to be managed and controlled carefully.

[silvrsvt]

1 hour ago, Rick73 said:

From financial standpoint, it’s really hard to justify spending much to upgrade from ICE to Hybrid if only driving around 3,000 miles annually.  Improving from 30 to 45 MPG only saves $100/year at $3.00/gallon.  That doesn’t pay for much up-front purchase cost, not to mention a hybrid battery replacement would wipe out a decade of gas savings even if I drove a lot more.  My point was that as cars/vehicles become more efficient in general, energy savings become less of a factor to total ownership costs.  Hybrids are a great idea, but costs have to be managed and controlled carefully.

 

I unexpectedly owned a 2010 Fusion Hybrid with over 200K miles on it for about a year. Battery still worked "fine" on it. All it is another possible point of failure...you saying the battery going bad is just like expecting ICE to go bad-it might but the chances of it happening are pretty small. Its not like replacing an ICE or even transmission is "cheap" these days. If I was in  a position like that, I'd just replace the vehicle if I had to put $5K in it at this point of my life. I'd rather have a reliable vehicle. 

[Rick73]

Hybrid batteries are “estimated” to last between 6 and 10 years of normal use, with +/- 8 years a good bet; and cost around $2,000 or more to replace.  That’s from limited research I could find on internet — rough estimates.

 

Thing is, hybrid cars also have an internal combustion engine, and a transmission (albeit a different type), so risk of needing engine or transmission work after warranty period doesn’t go away compared to pure ICE.  For fuel efficient cars like Corolla, Civic, or Mazda 3, it would take a lot of miles to save $2,000 in gas at $3.00/gallon if upgrading to a similar-size hybrid.

[AM222]

On 1/11/2024 at 1:56 AM, rmc523 said:

 

Many of us have wanted Puma to come over here to fill that smaller crossover vehicle gap.  But it won't happen.

A Focus-based crossover (a bigger Puma-like model to slot below the Escape) would have been nice. This is basically the segment of the Corolla Cross and Chevy Trax. Smaller C-segment crossovers that fill the space left by the traditional compact crossover SUVs (Escape, Rav4, CR-V etc.) that have grown larger and more expensive in recent years.

Edited January 29 by AM222

[Rick73]

It was honest mistake, and difficult to see how discussion went off topic when the very title of thread included eliminating ICE and replacing with BEVs and Hybrids.

“New Leader Shifts Lincoln's EV Plans - Lincoln is Expected to Discontinue Gasoline Versions of the Corsair and Aviator, While Its First EV, a Three-Row Crossover, is Expected in Late 2025“

 

Anyway, unless this thread is off topic also, maybe DeluxeStang can restate his posts here?  When it comes to powertrains, Ford versus Lincoln seems a distinction without a difference for the most part.