Ford Motor Co.’s latest iteration of its Focus compact car was launched in 2010 and has been a commercial success over the last few years. The successful release of the third-generation Focus was followed-up with the introduction of the electric Focus EV and the performance Focus ST versions to round out its stable of models. Whereas the gasoline-powered offerings have found their way into hundreds of thousands of homes, however, the electric model has struggled to establish a presence in the marketplace. With competition tightening, jostling for position in the electric car market, questions linger regarding Ford’s strategy for the Focus Electric, going forward.
While the Focus and Focus ST have continued to push the sales needle forward, combining to lift sales by 2%, year-over-year, to 133,884 units through June 2013 year-to-date, the Focus EV has struggled to push just 901 units over the same period. The slow start to the year comes on the heels of the model’s official retail sales launch in May 2012 that attained a meager 685 deliveries through December of last year. To put things into perspective, over that time span, Ford built 1,627 units of the electric car, an extremely modest production volume, yet was only able to sell 42% of them. Notably, during that same May through December period, the Chevrolet Volt sold no fewer than 1,680 units in any given month, totaling 18,804 sales.
Certainly, the competition has only become stiffer recently as automakers stretch to reach sales targets for their respective electric vehicles, which is not making it any easier for the Blue Oval. In January, at the 2013 North American International Auto Show, Nissan CEO Carlos Ghosn announced the price for the base-model 2013 Nissan LEAF would drop by $6,400 to become the price leader among 5-door electric vehicles in America, with a starting price of $28,800. As a result, sales jumped 244% within the next two months and monthly sales since March have averaged over 2,100 units. Upon seeing the jump in demand for the LEAF, GM declared price cuts of its own on the Chevrolet Volt that ran through July 1, 2013 in what appears to be a test of the market. To boost laggard sales, GM exercised price drops of $4,000 and $5,000 on its 2013MY and 2012MY Chevrolet Volt models, respectively, while also offering a $269/month lease, as well. To little surprise, sales vaulted to 2,698 units, the Volt’s most successful month since October 2012.
Similar to Nissan with its LEAF, at the turn of the new calendar year, Ford realized it was having difficulty pushing sales of the Focus Electric and rolled-out its own share of incentives. Included was a $2,000 reduction off the original base price to $37,995, as well as another $2,000 cash discount for an outright purchase or 1.9% financing through Ford Credit. In addition, for a three-year lease, $10,750 was deducted and one could get a 36-month lease for only $285/month and $930 down with 10,500 miles/year. Unfortunately, demand went largely unchanged as although March 2013’s 180 deliveries marked a new sales record for the electric car, it only surpassed the previous high by 8 units, set in November 2012.
In what appears to be a questionable move, for the 2014MY Focus EV due this summer, Ford will not make any enhancements or upgrades to the compact car, which is unusual considering how common model year changes are for other models. Last month, Ford’s director of Global Electrification, Nancy Gioia, told The Detroit News, “We still see battery electric as niche. We think that by focusing on the plug-ins and that awareness, we actually end up benefiting both the hybrids and the plug-ins.” Electing to keep the slow-selling Focus Electric unchanged demonstrates a potential lack of focus on the vehicle, however, especially if the desire, to some extent, is for the car to have a halo effect on the hybrid and plug-in models in Ford’s product portfolio.
While the Nissan LEAF’s recent sales growth can by-and-large be attributed to its deep price discounts, Nissan has made upgrades such as the availability of a faster-charging on-board charger for higher-end trims in addition to expansion of the vehicle’s cargo space. On the other hand, Ford has chosen to do nothing to improve its electric compact car and the automaker’s modest price deductions have shown a lack of interest to compete on price. Gioia went on to say, “We’re not going to chase down to the lowest price possible — that doesn’t make sense to erode the brand image or the true value of the product. We’re going to continue to evolve that product — make it better and better ... We don’t see the need to push it like crazy and erode the image of it.”
However, only a month later and contrary to previous statements, Ford has moved to drop the price of the 2014 Focus EV by 10%, or $4,000, to $35,995, including a $795 destination charge. In a statement released by the automaker, Ford announced, "The 2014 Focus Electric offers customers a fully-contented, all-electric vehicle option. The new starting MSRP of $35,200 keeps us competitive in the marketplace and is an important part of our commitment to provide customers with a range of electrified vehicles to choose from."
Time will tell if this is a sign that Ford is going to put forth a little more effort in its sales and marketing support for the Focus Electric. The new price of the electric car is still well above that of the LEAF, however, so it remains to be seen if demand for the vehicle will change significantly. Despite what appears to be a lack of focus though, evidence exists that Ford does have bigger plans for its Focus EV as the brand announced that it plans to expand to the European market by adding production of the car at its Saarlouis Assembly Plant in Germany. History does not suggest that things will change drastically for the Focus Electric in the future, considering sales have averaged just over 100 units per month, but perhaps the sales growth of its competition will prompt greater action to keep pace. Then again, it could be that all along, the Focus EV was nothing more than an image booster in support of green technology and fuel economy marketability.