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Answers to why Ford limits FEH/MMH production!

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Old May 19, 2008 | 04:15 AM
  #1  
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Default Answers to why Ford limits FEH/MMH production!

Not exactly an ah-ha moment, but debunks the popular theory that FEH/MMH battery packs are the limiting production factor.

See http://www.autobloggreen.com/2008/05...-mariners-thi/
 
Old May 19, 2008 | 05:03 AM
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Default Re: Answers to why Ford limits FEH/MMH production!

I guess we can only hope that the high margin cars/trucks they are building in lieu of hybrids end up sitting on the lots. I already wrote Ford a letter a few months ago letting them know I would not by an ICE only product of theirs again.
 
Old May 19, 2008 | 08:10 AM
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Default Re: Answers to why Ford limits FEH/MMH production!

There in lies the dilemma for Ford. Hybrid Escapes are simply not profitable. They are considered break-even by corporate (after amortization of capital expenses). So do you only build a few to help hit CAFE targets and establish a position as a viable hybrid builder or do you raise the price and build as many as the market will take?

My guess, and this is just a guess, if they raised the price to the point where they made as much profit on a FEH as a conventional Escape, they'd sell even fewer than 25,000. So lower the price to break-even and limit production. It should help their reputation for when the Fusion hybrid is released.
 
Old May 19, 2008 | 09:21 AM
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Default Re: Answers to why Ford limits FEH/MMH production!

Originally Posted by cbibbs
There in lies the dilemma for Ford. Hybrid Escapes are simply not profitable. They are considered break-even by corporate (after amortization of capital expenses). So do you only build a few to help hit CAFE targets and establish a position as a viable hybrid builder or do you raise the price and build as many as the market will take?

My guess, and this is just a guess, if they raised the price to the point where they made as much profit on a FEH as a conventional Escape, they'd sell even fewer than 25,000. So lower the price to break-even and limit production. It should help their reputation for when the Fusion hybrid is released.
I wonder if they really know the fair market price of a fuel efficient Escape. IMHO, increasing volume makes a lot of sense for repeat customers and long term growth ... versus next quarter's profits.

Bob Wilson
 
Old May 19, 2008 | 04:39 PM
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Default Re: Answers to why Ford limits FEH/MMH production!

I doubt anyone knows the current market value of a hybrid with the recent run up in gas prices. But, as I recall, Ford had to provide incentives to move FEHs the first three years of production so logic would say they were priced above market value.

I've driven V6 Escapes and found I could get 26 to 27 mpg, so pure economics calculations would say you have to drive a good bit to make an economic case for an FEH at last years $3.00 gas.
 
Old May 19, 2008 | 06:52 PM
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Default Re: Answers to why Ford limits FEH/MMH production!

Ken your comment about getting 26 mpg in a V6 Escape is surprising. Almost all of the posters in the Escape-Central.com forum that have V6 Escapes do not get anywhere near that figure. John Morton--a poster here on this site-- had a V6 Escape for six months prior to obtaining his first Escape Hybrid and he mentioned sub standard fuel economy with the V6 model.

As for the 25,000 hybrid figure, there is also the expensive eCVT produced by Asian AW, that is indirectly connected with Toyota.
 
Old May 19, 2008 | 07:13 PM
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Default Re: Answers to why Ford limits FEH/MMH production!

Originally Posted by KenG

I've driven V6 Escapes and found I could get 26 to 27 mpg,
The EPA says 18/23 on the new (realistic) mileage estimates. By your driving a hybrid gets well over 40. It's mute.
 
Old May 20, 2008 | 04:40 PM
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Default Re: Answers to why Ford limits FEH/MMH production!

It seems to me the new EPA estimates are low. I don't think I'm a particularly economical driver but I usually get better than the current ratings. I regularly rent cars and drive them several hundred miles. Last year I drove a V6 Escape on my usual route (lot's of 75-80 mph interstate, a run up to 8000 ft elevation etc.) and got 26mpg calculated by the fill up amount and the in car computer. Last week I drove an Impala (hated it) on the same route and got between 28 and 29. I've been able to get about 23 with an Explorer with a six cylinder (terrible performance) and 33 with a Chevy Cobalt (better car than expected).

I have no idea what I could get with our FEH - my wife seldom lets me drive it - but she gets 36 to 38 when the weather is moderate.
 
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