fuel prices and a stampede of urban cowboys exiting big pickups for
smaller vehicles are roiling Ford Motor Company’s short
and long term truck plans.
Ford announced it was delaying the introduction of the new
2009 Ford F-150 by two months and cutting shifts at two factories where the truck
will be built, in Kansas City, Mo. and Dearborn, Mich.
chief Jim Farley recently told journalists that the company expects
the full-size truck segment will sell 1.5 million units in 2008, about
9 percent of all vehicles sold. That’s
dramatically lower than full-size truck sales in 2004 and 2005, when
big pickups annually sold 2.5 million units, or 15 percent of all vehicles.
But the steep drop in full-size sales volume isn't the only change getting
attention in Dearborn. Ford has also noticed significant changes in the
mix of F-Series (F-150 to F-450) cab models and engines as personal use
buyers leave the segment.
"[On a percentage basis the past 12 months] sales of regular cab pickups
are climbing back up as crew cabs are falling," says Mike Crowley, Ford's
truck and SUV group marketing manager. "Historically, regular cabs have
been about 12 percent of our business. Today, regular cab sales are 20 percent,
while crew cabs have fallen from 65 percent to the mid-fifties. Extended cab
sales remain about the same, around 25 percent."
Mr. Crowley says the reason for the increase in regular cab penetration
is because core truck buyers (fleets, farmers, contractors) continue
to buy pickups to replace old trucks while personal use buyers, the biggest
buyers of four-door pickups, leave the segment entirely or hold off on
buying new trucks. And commercial buyers who might have purchased an
extended or crew cab are being forced to purchase a regular cab pickup
after considering the cost of $4 a gallon gasoline and $5 a gallon diesel.
That’s potentially bad news for Ford’s profit margins on
pickups. Crew cabs, especially fully outfitted versions like Lariat and
King Ranch models, bring in up to tens of thousands of dollars more than
lower trimmed regular cab versions. A 2008 Ford F-150 Super Crew Lariat
with four-wheel-drive, for instance, has a $36,000 base price, excluding
destination - $18,100 more than the cheapest regular cab F-150.
"People buy as much truck as they can afford," says
launches the 2009 F-150, marketing emphasis will be placed on the middle-of-the-road
XLT model, which makes up about 40% of all F-150 sales volume. Mr.
Crowley calls the XLT the heart of the market. It’s
the model that’s held up best with core truck buyers.
and hardware prices are also impacting which engines buyers are selecting
in Ford’s heavy-duty pickups. Ford F-250 and F-350
Super Dutys have long been popular with buyers looking for pickups with
used to run at 75% diesel sales but now sales are at 60% diesel," says
Mr. Crowley, as gasoline engines have increased their percentage share
from 25% to 40%.
What’s so important about this shift is that diesel engines have
long been the choice of Ford Super Duty buyers because of their superior
performance over gas engines for towing and hauling applications. But
diesel costs have become too high for Super Duty buyers who don’t
need maximum capability.
AAA, diesel fuel currently carries a 17% price premium over regular gasoline.
Diesel powertrain prices have also risen over the past several years as
new hardware components have been added to meet toughened federal standards
for emission. A 6.4-liter Power Stroke diesel V-8 carries a $6,875 premium
over a gas engine, when equipped with a manual transmission. It’s
$8,385 when ordered with an automatic.