While releasing its first-quarter results, the company also set out plans to cut another $11.5bn in costs, bringing the total to $25.5bn by 2022.
According to Advertising Age, nearly half of the cuts will come from sales and marketing – through incentive optimisation, reduced advertising spend and other measures – with the remainder coming from engineering and product development, material costs, manufacturing and information technology.
Signalling the changes in a statement, Ford said it expected 90% of its portfolio in North America to be made up of trucks, utilities and commercial vehicles by 2020.
“Given declining consumer demand and product profitability, the company will not invest in next generations of traditional Ford sedans for North America,” the statement read, adding that its North American business will “transition” to just two marques – the Mustang and the Focus Active crossover, which launches next year.
It means that such well-known brands as the Fiesta, Fusion and Taurus won’t survive the transition, although Ford chief financial officer Bob Shanks, while speaking to reporters, said the famous Lincoln brand is not in danger.
However, Advertising Age noted that analysts predicted the future of the Lincoln Continental and MKZ sedans remain in doubt because they share platforms with many of the Ford marques that are due to be scrapped.
The sedan has long been a staple for Ford, but the company now wants to focus more on hybrid-electric models too. It said its battery electric vehicle rollout will start in 2020 with a performance utility, and it plans to launch 16 battery electric vehicles by 2022.
Ford also announced that it generated net income of $1.7bn in the first quarter, up 9% year-on-year, although it made a loss of £119m in Asia Pacific and a loss of $149m in South America.
Sourced from Advertising Age, Ford; additional content by WARC staff