(Reuters) - Ford Motor Co (F.N) is looking at ways to expand its sport utility vehicle portfolio as SUVs grow to 40 percent of the U.S. light vehicle market by 2020 from about a third today, global sales chief Stephen Odell told Reuters.
“As a segment gets that big, it’s probably going to fragment into different requirements,” Odell said in an interview ahead of the unveiling on Tuesday in Los Angeles of the 2017 Ford Escape, a re-styled version of the company’s best-selling SUV model in the United States.
Ford sells a smaller sport utility vehicle called the EcoSport in Europe and Latin America and has studied it for the U.S. market, Odell said. “It could at some point become a substantial part of the industry,” he said.
Separately, United Auto Workers union officials and analysts have said they expect Ford to use a factory in Wayne, Michigan to build a new SUV and a new pickup truck after production of the Ford Focus compact car is moved to Mexico in 2018.
Sales of the current Escape in the United States should beat last year’s record of 306,212 vehicles, Odell said. But Escape sales are rising at a slower pace than several competitors, up just 1 percent for the year to date compared with 15 percent for Toyota Motor Corp’s (7203.T) RAV4 and 41 percent for Nissan Motor Co (7201.T) ’s Rogue.
The intense competition Ford faces is reflected in decisions the company made as it revised the 2017 Escape, which goes on sale next year.
Ford redesigned the exterior and interior of the 2017 Escape. But it won’t offer collision avoiding automatic emergency braking systems on the 2017 Escape, Odell said. Toyota said it will offer such collision avoiding systems as optional equipment for $300 to $500 on many 2017 models.
“We think we’ve got more than enough safety technology on this product that’s relevant to the drivers that they would be prepared to pay for,” Odell said. Vehicles in the Escape’s class have starting prices just under $24,000, and Japanese and European competitors currently have cheaper currencies to offset the cost of new features.
Ford and several other automakers agreed with the National Highway Traffic Safety Administration in September to make automatic emergency braking standard on future new vehicles for the U.S. market. But the automakers didn’t set a deadline.
Reporting By Joe White, additional reporting by Bernie Woodall; Editing by Alan Crosby