Ford C-Max hatchback to be offered only as a hybrid
Automaker will triple electrified vehicle production to 100,000 a year
Photo credit: FORD
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DETROIT -- Ford Motor Co., in a move to compete with hybrid and electric vehicles produced by Toyota, GM, and Nissan, said today that its upcoming C-Max hatchback will be a dedicated hybrid when U.S. sales begin next year.
And Ford has cancelled plans to offer a version of the C-Max with a four-cylinder gasoline engine.
Ford said it has been able to reduce the cost of hybrid technology, which will make the vehicle more attractive to buyers. Ford announced this year that a plug-in hybrid C-Max Energi also is planned.
Today's move will put the C-Max in competition with Toyota Motor Corp.'s Prius hybrid, General Motors' Chevrolet Volt plug-in hybrid and Nissan Motor Co.'s all-electric Leaf.
Ford executives, during an event today in Sterling Heights, Mich., said they plan to triple North American production of electric vehicles and hybrids to more than 100,000 models by 2013 as they work to make a quarter of their vehicles run at least partly on electricity.
More jobs, fewer passengers
Ford is investing $135 million and adding 220 jobs at three Michigan plants to produce five "electrified" models. Besides the C-Max and C-Max Energi, the automaker is building an electric version of its Transit Connect van and will start making a battery-powered Focus compact this year. Ford has not yet announced the fifth vehicle.
The C-Max is a five-passenger hatchback based on the Ford Focus platform.
Ford's original plan was to sell the seven-passenger C-Max model -- already available in Europe -- in North America in 2012. Until today's announcements there were no plans to sell the five-passenger C-Max in North America.
"This is a big deal for us because we are seeing a huge growing appetite for fuel efficient green vehicles," said Jim Farley, Ford's group vice president of marketing, sales and service. "The number of people indicating fuel economy is the main reason continues to rise."
In terms of fuel economy, Farley said "this is a better opportunity than introducing a gas engine, seven-passenger C-Max in North America. This decision shows how flexible the one Ford Strategy is, that we can change with market conditions."
Although Ford did not announce the miles per gallon target for the hybrid C-Max, Farley said it would be higher than the Ford Fusion's 41 mpg.
Automakers are developing models powered at least partly by electricity as U.S. fuel-economy standards rise. The company said it currently sells about 35,000 electrified vehicles a year, which includes the Fusion Hybrid and Escape Hybrid.
"The market is moving and we are shifting with the market," Sherif Marakby, Ford's director of electrification programs and engineering, said in an interview today. "Our choice is to increase the capacity on the sales of the smaller version for this fuel economy conscious consumer, and we believe there is more market in this than the seven-passenger small van."
Farley said in a statement: "Whether people want a hybrid, a plug-in hybrid or full battery electric vehicle, we have a family of vehicles for them to consider, providing a range of options to best meet their needs and support their driving habits and lifestyles."
Ford said this year that it expects the cost of hybrid systems it begins offering next year will be 30 percent less expensive than the system that was introduced on the 2010 Ford Fusion.
Ford said it will be able to keep C-Max prices down because much of the hybrid system has been designed and engineered by Ford. The company also will assemble the system.
For example, an upcoming hybrid transmission was designed and engineered by Ford and will be assembled beginning in the first quarter of 2012 in a suburban Detroit Ford plant.
The hybrid transmission in its 2011 Ford Fusion and 2011 Escape and the 2011 Lincoln MKZ are supplied by Japan's Aisin Seiki Co.
The new Ford transmission will be used globally and sourced from Michigan.
Hybrid loyalty rates 'very high'
In an April nterview, Marakby said, "When we first launched a hybrid six years ago, many customers were concerned" about the battery. Customers asked: "'How long would the battery last?' 'How much does it cost to replace it?'" he said.
But batteries have proven to be long-lasting, Marakby said. It's now imperative to lower the cost of its hybrid system, he said, so Ford can cut hybrid prices and boost sales.
"We're seeing that the loyalty rate on hybrids is very high," he said in April. "We just need people to get used to the technology, bring the cost down and the price down for consumers, and we believe it's only going to go up in terms of sales volume."
Ford has been cutting costs by bringing many technologies in-house, such as the hybrid transmission, Marakby said in April.
"By developing the hybrid system's design in-house and sourcing individual components to suppliers, Ford can use less people and less time to get the job done in an efficient manner," he said.
Additionally, Ford has developed in-house a battery system that will be manufactured at a suburban Detroit Ford plant next year.
Marakby's goal is to cut the cost of the next-generation Ford hybrid system another 30 percent.
Bloomberg and Jamie LaReau contributed to this report