Ford Motor Co.'s action last week to hold the price on the redesigned 2002 Explorer reflects a reality of today's market: Raise prices at your peril.
But Ford can't afford any risks with its top-selling, highly profitable and now-tarnished sport-utility.
Here are pricing highlights:
The two-wheel-drive, V-6-powered 2002 Explorer XLS four-door with automatic transmission will sticker for $25,715. That's the same price as the 2001 model, including $600 for transportation.
A new Explorer XLS four-door with a five-speed manual transmission carries a $24,620 sticker, including freight. A stick shift is not offered on the 2001 Explorer four-doors.
The 2wd, XLT V-6 with automatic transmission will be $28,380, which is $135 less than the 2001 model.
The price of the Mercury Mountaineer, a companion to the Explorer, went up $1,000 with 2wd and $515 with all-wheel drive.
Both vehicles go on sale in the first quarter of next year. And both have been redesigned from top to bottom.
The new models offer seven-passenger seating and safety innovations.
Refinements reduce noise, vibration and harshness and provide more carlike comfort.
An independent rear suspension, the type found in luxury sedans, has been added.
A BIG QUESTION MARK
In the past, such an extensive redesign might have assured continued success.
But the U.S. market has changed: U.S. industry sales have slowed; rebates are soaring and competition is increasing.
There's also the big question mark hanging over the Explorer because of the Firestone tire debacle.
'We knew that we weren't going to be able to increase the price of the vehicle in any significant way,' said David Rodgers, vehicle dynamics supervisor for the Explorer and Mountaineer.
'We didn't want to repeat the (1996) Taurus situation of improving a lot of function, but increasing the price up to the point where it pushed us out of the range.'
Rodgers added: 'We continue to squeeze our supply base and ourselves to be as efficient as possible in order to add more function at the same cost. That's really the approach.'
Last year, Ford sold 428,772 two-door and four-door Explorers in the United States. This year, despite the controversy over Firestone tire failures, Explorer sales through October were up 8.6 percent. This year's sales include the new SportTrac sport-utility/pickup.
But the new Explorer will face much tougher competition than the current edition did when it came to the market in 1994.
In the past two months alone, Acura and Toyota have fielded new sport-utilities, both with seven-passenger seating. Early next year, the new Chevrolet TrailBlazer and Toyota Highlander bow, along with the redesigned GMC Envoy.
The Explorer and Mountaineer redesigns include major changes to the powertrains. The standard 4.0-liter V-6 has been re-engineered.
New this year is an optional 4.6-liter V-8 and a five-speed automatic transmission; they replace the 5.0-liter V-8 and four-speed automatic used in the 2001 model. Also new is an optional third-row seat. It stickers for $670 on the Explorer.
MOUNTAINEER GOES UP
Mercury, meanwhile, has added equipment and boosted the sticker for the new Mountaineer.
The 2wd 2002 Mountaineer equipped with the standard 4.6-liter V-6 carries a $29,230 sticker price, up from with $28,230 for the 2001 model.
The awd 2002 Mountaineer is $31,210, up from $30,695. Prices include $600 for transportation. The third-row seat is standard on the 2002 Mountaineer; it was not available for 2001.
Though the Mercury product will share engines with the Explorer, the Mountaineer will not offer a four-wheel-drive system.
An optional awd system will be exclusive to the Mountaineer.
Moore said a loaded, awd Mountaineer V-8 will sticker slightly above $37,000.