Political unrest in Libya could ignite small car sales

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What could political strife in Africa possibly have to do with U.S. sales of the redesigned 2012 Ford Focus compact?

A lot.

The uprising in oil-rich Libya is already affecting the cost of crude oil. Libya, the world's 15th-largest crude exporter, is Africa's largest oil-producing nation. Some pundits predict U.S. gas prices could hit $5 or more a gallon depending on what happens there.

Meanwhile, Ford Motor Co. will launch the 2012 Focus here this spring. The automaker is targeting an estimated fuel economy of 40 mpg highway.

Ford already has a new subcompact earning strong fuel economy -- the Fiesta.

Launched last May, the 2011 Fiesta earns 37 mpg highway.

But late last year, analysts predicted gas prices would hold steady or dip. Ford executives were undeterred. They consistently said Ford's small cars would sell regardless of gas prices because of the other technology on them.

Besides, Ford remained confident that gas prices would -- one day -- rise again.

Well, if Libyan leader, Moammar Khadafy, is ousted and political instability ensues, that day could come soon. A gas price spike would help buoy U.S. small car sales -- making Ford leaders either incredibly lucky or incredibly wise.

Likely, a bit of both.

You can reach Jamie LaReau at jlareau@crain.com. -- Follow Jamie on Twitter

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