Ford misjudged the demand for its Excursion

Many SUVs selling well, industry reports

Motors

May 20, 2000|By Ted Shelsby | Ted Shelsby,SUN STAFF

Ford Motor Co.'s decision to cut back on production of its big and pricey Excursion sport utility is not reflective of the sport utility vehicle market overall, officials said yesterday.

"I wouldn't view our move as an indication that the SUV market is on the decline," said George Pipas, Ford's manager of sales analysis."This is just one manufacturer adjusting to sales of one vehicle," Pipas said.

He pointed out that, while industry sales of cars and light trucks are up 10 percent so far this year, SUV sales are up 16 percent.

Pipas said Ford misjudged the market for its Excursion, a 19-foot long, 7,000-pound vehicle with a $42,000 price tag that dwarfs any car and most other SUVs on the road., "We put in more capacity in our factory than we needed. We're going to use that excess capacity to boost production of our full-size pickup trucks," he said.

In addition to reducing production of the Excursion, Ford announced this week that it would delay introduction of a new version of its popular Explorer SUV because of design and supplier problems.

"There are no signs yet that SUV sales are shrinking," said Michael Flynn, association director of the University of Michigan's Office for the Study of Automotive Transportation. "And I don't see anything on the horizon that would indicate they are going to drop off in the future."

But that could change, Flynn said, if gasoline prices suddenly rise.

Pipas said it is difficult to measure the impact of higher gasoline prices on gas-guzzling SUVs.

He said that, when the 2000 model year began in the fall, the average national price of gasoline was 90 cents a gallon. In the first quarter of this year, it rose to $1.50 a gallon.

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