Does Ford Have a Big Problem with Small Cars?

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UPDATED: Mar 13, 2020

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Ford has a 126 day supply of unsold Fiestas.

Ford has a 126 day supply of unsold Fiestas.

We’ll admit to loving smaller cars, especially those that come equipped with hatchbacks, which have always seemed to be wanting for more buyers in the U.S. market. And we’re also fans of the Ford Motor Company’s Focus and Fiesta models – which are both available as hatchbacks.

The Fiesta and the Focus both offer levels of sophistication that’s uncommon in such cheap transportation, with sporty, European-inspired handling and an impressive array of creature comforts. They’re both high-quality models that we’d have no problems recommending to anyone in the market for a small automobile.

But could these small cars be on their way to becoming a big problem for Ford Motor Company? Signs seem to point that way.

According to the Wall Street Journal, Ford dealers are facing a glut of unsold Fiesta and Focus models. As 2011 ended, Ford had a 92 day supply of Focus models sitting on dealer lots. And the Fiesta fared even worse, with a 126 day supply of unsold models on dealer lots.

Compared to General Motors, which ended 2011 with just 68 days worth of the Chevrolet Cruze (a direct Ford Focus competitor) and a scant 61 day supply of the Chevrolet Sonic (a direct Ford Fiesta competitor), Ford’s inventories do indicate an oversupply. Automakers aim to have sufficient models for a 60 day supply – or less – on hand at any given time.

For it’s part, Ford told the Wall Street Journal they will take actions, even a slowdown in production, if sales don’t improve. What they don’t want to do is lower their asking price, or up the level of manufacturer subsidies through rebates.

And if Ford does indeed slow production of the Fiesta or the Focus, how will it impact the soon to be introduced Focus Electric – which is a plug in EV version of the Focus with no internal combustion engine?

 

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