For the October edition of our Guidelines we’re going to take a closer look at the entire ultra-competitive compact utility vehicle segment, but for this blog we’ll focus primarily on the new Ford Escape. Currently Ford’s compact CUV is at the top of this segment and from the looks of things, Ford might have the perfect recipe for segment domination moving forward.

Having sold essentially the same vehicle for the past 12 years, Ford finally redesigned the Escape for the ‘13 model year. It’s no secret that this platform was long overdue for a makeover, but considering its archaic design it’s still impressive to see that during the ‘11 sales year Ford managed to move over 254k new Escapes.  In the process, the outgoing model, outsold  all of the more progressively designed competition in its class including the Honda CR-V (218k), Chevrolet Equinox (193k), and Toyota RAV4 (132k).

The new design architecture of the Escape is gorgeous both on the outside and within. Looking at the exterior it doesn’t look anything like the previous generation where a chiseled muscular free flowing design replaces the old square milk carton look. On the inside the Escape looks like a vehicle that should cost much more than it does. If you covered up the blue oval on the steering wheel and asked someone to guess what kind of vehicle it was I bet they would utter something European or Japanese, that’s just how good it looks.

Powertrain-wise there are three different four-cylinder engines available, each mated with a six-speed automatic transmission. Ford decided to eliminate the hybrid version for now and also removed a manual transmission option from the lineup. Two of the three new motors offered in the Escape use EcoBoost turbocharged technology which ups power output while maintaining fuel economy. Across the board EPA city fuel economy is rated at 21-23 mpg while highway economy comes in at 28-33 mpg depending on engine and drive type.   

Speaking of cost, base S model front wheel drive pricing starts at a very reasonable $23,295 (including destination). The walkup to the SE model is $25,895, SEL $28,695, and the top level Titanium will cost you $31,195. If you want to option up to four-wheel drive expect to tack about $1,750 onto each MSRP, although the base S model is only available in front wheel drive.  In comparison the ’12 Honda CR-V LX model starts at $23,325, adding four-wheel drive will add about $1,250 to the bottom line.

Looking current segment sales year-to-date the Escape is actually trailing behind the CR-V by a little over 13k units, but it’s important to remember that the ’12 CR-V went on sale four months before the ’13 Escape. Since getting their inventory under control in June Ford has maintained a four month segment sales lead which can been seen in the chart below. The only competition to even come close in terms of new sales is Honda who’s also selling a newly designed ’12 model year CR-V.

The latest average incentive spending data released by Autodata shows that Ford pulled back incentive spending on the Escape by nearly $200 for September landing at $1,357 for the month.  Honda on the other hand increased average incentive spending by about $120 for September landing at an extremely lean $598 for the month. 

In terms of negatives, according to recent Polk vehicle registration data over 48% of the new ’13 Escapes that have produced and registered so far have ended up in rental fleets. Compare this to the ’12 CR-V rental fleet penetration rate of .02%.  This surprisingly high fleet pen rate raises the potential for the Escape’s retention to be softer than otherwise once these units hit the used market.   To put things in perspective total ’12 model year fleet penetration for the Escape was only 11%.

Ford certainly has the right ingredients for sales success of the new Escape, but should proceed with caution if they want to protect value retention. Moving forward not only with the Escape, but as a brand they need to continue to pull back on average incentive spending and control production in order to maintain higher values on the used vehicle side. Their new product across the board is certainly class leading (Escape, Fusion, Etc.), but if too much product is produced and fed into fleet duty value retention will ultimately suffer.

Be sure to check this month’s edition of Guidelines as we take a deeper dive in the CUV segment including some historical sales trends and incentive information for all of the competitive vehicles in this segment.