During an era when automobiles were still looked upon as nothing more than toys of the rich, Henry Ford said, “I will build a motor car for the great multitude.”
With conviction that the next stage of the automotive industry would concur alongside ownership by the working class, he unveiled the Model T in 1908 and began the age of affordability.
Now, 110 years later, Ford Motor Company’s newest CEO, James Hackett, also sees a new era on the horizon. One in which the great multitude owns electric and self-driving vehicles.
Yet, while their founder approached the future by advancing the concept of traditional passenger cars, Hackett plans on getting there by sacrificing them.
During their first quarter earnings call, he announced the company “will not invest in next generations of traditional Ford sedans for North America.”
Sedans, as well as their hatchback variants, make up the vast majority of Ford’s car portfolio. So much so that after the cut is finalized, Ford’s only remaining car in America will be the Mustang.
Yet, the sacrifice of the sedan is the centerpiece of Hackett’s vision for the company’s future.
“By 2020, almost 90 percent of our Ford portfolio in North America will be trucks, utilities, and commercial vehicles, including, of course, their electrified versions,” he proclaimed.
And he isn’t alone in this idea of moving away from the concept of traditional cars. It’s actually become a trend among the big three automakers in recent years.
With brutal competition from Japan in the realm of economy cars, Fiat-Chrysler has pretty much dropped out of that market to focus more on light trucks and performance nameplates.
And just this Monday, GM announced plans to lay off workers from five car plants in the U.S. and Canada, ending the production of several car models ranging from compacts to luxuries.
The overall consensus among the big three is that passenger cars of any size just aren’t worth it anymore. They’re no longer what the great multitude wants.
And, from a contemporary point of view, that logic makes sense. Light trucks – which include SUVs, pickups, and vans – have become immensely popular in the 21st century.
According to market data from the Wall Street Journal, those vehicles have steadily risen in their share of total U.S. auto sales since the 1990s. By the turn of the 21st century, they had matched passenger car sales, and by 2012, they had overtaken them.
This is precisely why Hackett and the other auto CEOs are so eager to close the curtain on cars. They see them as relics of a bygone era.
They’re also convinced that the current phenomenon of SUVs will prevail throughout the 2020s and into the age of electric and self-driving vehicles.
So, why keep funding fossils like sedans when the money saved from their cut could be invested in preparing more popular SUVs for the future?
Well, just as fashion changes throughout each decade, so does taste in automobiles. From pop culture to politics, the methodology behind motor vehicle trends is constantly being influenced.
Who’s to say that some unforeseen event won’t transpire within the next 10 years and suddenly make SUVs unpopular? It’s not like sudden changes in taste have never happened before, gas guzzling “land boats” were all the rage pre-1973, then the oil crisis said hello.
By dumping every car except the Mustang, Hackett has severed his ability to adapt to unanticipated circumstances later on that could cause drastic changes in vehicular preferences.
His plan is based off the assumption that SUVs will surely carry the auto industry into the electric age. And perhaps they will, or maybe station wagons will make a comeback.
It’s a gamble.