Ford: Gasoline cars are a growth business


Except it doesn’t die, said Kumar Galhotra, president of Ford Blue, Ford’s internal combustion vehicle division. On the contrary, he said, it is increasing.

“For someone who is nursing, I’m spreading a lot of my time and investment [production] The capacity of all our Ford Blue vehicles,” he told CNN Business. “So for me, Ford Blue is a growth story.”

Essentially, by keeping a foothold in the internal combustion world, Ford is capitalizing on customers who are losing access to gas-powered vehicles from other automakers, even as Ford itself introduces new EV models.

]Ford has just unveiled a new Mustang coupe that isn’t particularly electric or hybrid. The new two-door Ford Mustang was able Ford executives said they remain gas-electric because the company is filling in with support for electric vehicles (the Mustang Mach-E SUV) and plug-in hybrids like the Ford Escape PHEV. (Hybrids are also included in Galhotra’s Ford Blue division.)

But there remains a market for internal combustion performance, and Ford decided to serve customers who still want it, Galhotra said. Meanwhile, Stellantis has announced that it will end production of the Dodge Challenger coupe and the closely related Dodge Charger in 2023.

“In this particular segment, in the Mustang, while the segment may shrink, there is a lot of speculation that our competitors may leave this segment,” he said. “So even though the industry segment is shrinking, we can grow.”

Unlike GM, which has publicly stated that it plans to sell only zero-emission vehicles by 2035, Ford has not set an end date for making and selling gas-powered vehicles. While Ford has had some success with electric vehicles like the Mustang Mach-E and F-150 Lightning, they are sold alongside gas-powered models in the same market segments. And Ford also sells hybrid and plug-in models, and GM has said it will jump straight into EVs.

Ford is concentrating gas-based vehicles in three broad areas that include all models Ford sells, Galhotra said. They are enthusiast vehicles like the Mustang and Bronco off-road SUVs, general-purpose SUVs like the Ford Escape and Explorer, and of course trucks like the F-Series and Maverick. In those areas, he said, Ford is still finding new niches to explore, like with the Bronco and the Maverick, a small truck with car-like engineering. Both are models that were recently introduced in segments where Ford did not compete and are doing well.

“We can’t do enough Mavericks,” Galhotra said. “We are completely exhausted.”

Most of the customers for the smaller Bronco and Bronco Sport are new to Ford, he said. About 60% of Ford Bronco buyers have not owned a Ford recently. These are close to the so-called “conquest rates” of Ford electric vehicles like the Mustang Mach-E and the Ford F-150 Lightning electric truck. But Ford has sold more than 75,000 Broncos and 71,000 Bronco Sports in the first eight months of 2022, compared with about 26,000 Mustang Mach-Es. Also, Ford has sold nearly 50,000 Mavericks and most buyers are new to Ford even for that small truck.

To keep sales growing, Galhotra said Ford can continue to spend and stretch its various model lines. The Bronco is already a family of models, including the full-size Bronco SUV and the smaller Bronco Sport. Each also has several special editions, such as the Heritage model. Ford has successfully used a similar strategy with the Mustang, creating seemingly endless variants, from the $27,000 4-cylinder Ecoboost Mustang to the $80,000 760-horsepower Shelby GT 500.

“I see the potential for Maverick to have a family someday,” she said.

It is clear that at some point, gasoline-powered vehicles will be phased out, Galhotra allowed. But it’s unclear when that will be and, as other automakers move toward offering only electric vehicles, Ford stands to pick up sales from drivers. Galhotra said he is not ready to make the change. At the same time, of course, Ford will also offer electric vehicle options for them those who are ready, he said.