Thursday, March 13, 2014

Ford needs a North American EcoSport...Fast.

The SUV takeover is nearly complete!  Subcompact sport utility vehicles are taking over South America, Asia, and Europe.  Some in North America think it's a bit funny that the small hatch-loving Europeans are getting in on the SUV craze that hit America in the 1990s.  The SUVs they are craving are different, because they are small, but the demand is huge.

Jeep unveiled the new small Renegade SUV recently, and auto enthusiasts laughed.  How would American Jeep lovers ever consider this little Italian off-road ute?  Auto enthusiasts are often wrong, and market research is often right.  The Jeep Renegade isn't as much for the Jeep loyal as it is for the folks considering a Kia Soul.  You may not know it, but the Kia Soul is extremely popular.  The size and price is right for people, and that is what Jeep is going after.

In international markets Ford released a Fiesta-based SUV called the EcoSport, which was designed in Brazil.  The vehicle is selling well in many parts of the globe, but it is not yet in North America.

I mention all this because I see the sub-compact SUV being a huge market in North America in the near future, and Ford needs a player in this market before it explodes.

Vehicles like the Nissan Juke may be in this market, but is too funky to be taken seriously.  There is word that Honda will be releasing a Fit based SUV in North America as well.

Therefore, I believe that Ford needs to launch a next generation EcoSport sub-compact SUV in North America within 3 years.  The Fiesta is a great vehicle, but is due for a platform update.  It would not surprise me to hear that Ford is making ready a NA version of the EcoSport.  You see, the current EcoSport may be good for Brazil, India, and Europe, but we demand something special.  Therefore, a next generation EcoSport could go on sale in the US in 2016, while the current generation is still sold in other markets.

SUVs are more expensive than sedans, and tend to hold their value.  There is a huge market out there wanting a small SUV from $17,995-$25,000.  These customers would normally be getting into an economy car, but are now getting into a nice SUV for a little more.

The Jeep Renegade is probably going to the one of the best entries into this market.  Ford could wait and see how it does, but I think they should go all in now.

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