Ford Gains on Toyota With Hot New Fusion
Ford said on Wednesday that its U.S. sales rose 18% in April, a better-than-expected number that was driven by exceptionally strong sales of its most recent new models.
Ford's Fusion sedan and Escape SUV both posted very strong results, up 24% and 52%, respectively, making April another excellent month for Ford's two newest models.
The new Fusion, in particular, is turning into a big story for Ford.
A nice story in a huge market segment for Ford
To be clear, the success of the all-new Escape is nothing to sneeze at. Ford officials noted on Wednesday that the Escape was the compact SUV class sales leader in the first quarter, outselling its longtime nemesis, Honda's popular CR-V.
And Ford's F-Series pickups continued to shine in April, posting a 24% sales gain as industrywide sales of full-sized pickups continued to gain momentum, driven by increasing strength in the construction market.
But the Fusion's success is a big deal for Ford. After the F-Series and its main rival, General Motors' Chevy Silverado, which are the country's two best-sellers, the vehicles that top America's sales charts are all midsized sedans. For years now, the two cars to beat have been Toyota's ubiquitous Camry and Honda's ever-popular Accord.
Fusion isn't beating them - yet - but it has gained a lot of ground. And Toyota may be starting to feel that pain: The Japanese giant's U.S. sales were actually down slightly in April, meaning that Ford gained market-share ground on its biggest foreign-based rival.
Ford noted that the Fusion in particular was posting very big sales gains in the western and southeastern U.S., areas where Ford has historically had less strength versus the import brands. To cite one example, Ford U.S. sales chief Ken Czubay said that the "conquest rate" - the rate at which Fusions are sold to people trading in other brands - was a very strong 59% in the Los Angeles market, with customers trading in primarily Toyotas and Hondas.
Supplies may be tight for a few months
Czubay said that having sufficient supplies of Fusions on Ford dealer's lots "will be a challenge" through the summer, particularly in the west and southeast regions. Production is the bottleneck: The factory that makes the Fusion is maxed out, plain and simple, due to high demand.
Ford is adding a second production line for the Fusion at its plant in Flat Rock, Mich. The Flat Rock factory, which currently assembles Ford's Mustang, is one of only a few North American Ford plants with significant extra capacity.
That production line should be up and running this fall, and those additional Fusions should help Ford gain more ground on the Camry and Accord - adding to what has become a nice product story for the Blue Oval.
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The article Ford Gains on Toyota With Hot New Fusion originally appeared on Fool.com.Motley Fool contributor John Rosevear owns shares of Ford and General Motors. Follow him on Twitter at @jrosevear. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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