The carmaker’s CEO Alan Mulally has now reaffirmed plans to continue with development for a new-generation of Ford small cars destined for U.S. consumption, despite high fuel prices starting to recede.
Fuel "prices are going to stay relatively higher, even though they're down right now," Mulally told Automotive News last week. "The most important thing we can do is have a full complement of small and medium-sized cars and utilities that complement our larger vehicles."
The first of Ford’s new small cars will be the all-new Fiesta, which is set to enter production in Mexico in 2010. According to Mulally, an array of subcompact and Focus-sized compact cars will follow. The smallest of these, the second-generation Ford Ka, which was recently unveiled in Europe, is also a possibility but no firm decision has been made.
One of the biggest hurdles for the introduction of small cars is profitability. It will be tough to replace the $8,000 to $10,000-plus profit margins on big pickups and SUVs.