Ford Motor Company (F) Announces It's Dropping Sedans In Major Product Shift

2018 Ford Mustang facelift

2018 Ford Mustang facelift

Responding to a shift in consumer demand to SUVs and pickup trucks, Ford said it planned to trim its North American auto portfolio to just two models: the sporty Mustang, which debuted 50 years ago this month, and a new compact crossover called Focus Active starting in 2019.

For starters, it means Ford's Fiesta, Fusion and Taurus are out, with the Mustang and 2019 Focus Active the lone survivors. The 9% increase in quarterly profit can be nearly entirely attributed to a drop in the automaker's effective tax rate to 9% from 28.6%, Ford officials said.

The automaker says it made $1.74 billion, or 43 cents per share, compared with $1.59 billion, or 40 cents per share a year ago.

Ford's revenue worldwide increased 7 percent to $42 billion for the quarter.

Ford Motor Co. is sharpening its knives to cleave another $11.5 billion from spending plans and cut several sedans, including the Fusion and Taurus, from its lineup to more quickly reach an elusive profit target.

Your Ford Taurus may be about to become a limited edition.

Speaking on Wednesday as the company reported first-quarter results, Chief Financial Officer Bob Shanks said 'we have looked at every single part of the business.We are driven to turn this business around'. Big trucks and SUVs generate more dollars per unit than cars, indeed Dearborn predicts that, by 2020, 90 per cent of its range will be "trucks, utilities, and commercial vehicles".

In 2016, Fiat Chrysler Automobiles announced it would end production of the Dodge Dart and Chrysler 200 to focus even more on SUV and trucks.

Michelle Krebs, executive analyst at AutoTrader.com, said Ford's move is no shock. It is clearly saying any advantages the traditional sedan had (such as a lower center of gravity) are no longer enough to make up for a small- or medium-size crossover's greater space. What about Brazil? Too early to tell, Ford folks say, but they also whisper nothing is off the table.

Ford is counting on its planned cost reductions to reinvigorate its North American operations.

Right now, however, "there are no signs the shift away from cars will slow down", Kelley Blue Book said in December, a month in which sales volume was again dominated by crossovers, pickup trucks and SUVs.

The automaker also reiterated its previously announced plans to "bring 16 battery-electric vehicles to market by 2022" - starting with an all-electric CUV with 300 miles of range.

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