More Small Cars for Renault, Ford
By Michelle Krebs June 14, 2007French automaker Renault reportedly is considering creating a cheaper version of its no-frills Logan sedan that would reportedly cost $3,000. Ford, meantime, has selected Brazil to build its next-generation Fiesta subcompact, which would be sold in North America as well as its traditional markets.
Both moves illustrate accelerating trends: the emphasis on small, inexpensive vehicles for emerging markets as well as mature ones like North America; and the increased use of low-cost production sources for vehicles.
Renault, according to an article in the French newspaper Le Figaro today â- a report the automaker will not confirm -â will hire 1,000 engineers in India to develop the super low-cost model within three years. The car would be aimed at emerging markets and would not be sold in Europe.
Renault began selling the Logan in India in May through a joint venture with local automaker Mahindra & Mahindra. It sells for $9,700-$12,400. In Europe, the Logan's base model sells for $10,100.
Ford reportedly has chosen Brazil over Mexico to build its new Fiesta. The much-needed B-segment subcompact will be sold in the U.S. around 2009 or 2010, according to anonymous sources quoted by Dow Jones wire service. The car is based on the new Mazda 2 and Fiesta B2E platform, but will be styled for North America.
Pascual Francisco, South American analyst for the forecasting firm, Global Insight, in the companyâs newsletter today, sees Brazil as a risky choice for Ford. The country lags industry standards in quality. Currency fluctuations have made exports more expensive. The Sao Paulo region in which Ford will be operating is heavily unionized, the most expensive for production in Brazil and subject to frequent work stoppages and wage negotiations.
However, on the plus side, Francisco notes, the plant exists and manufactures the current Fiesta so it will require only minor upgrades for the new version, which can be done quickly and less expensively.
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I saw an EcoSport driving around Dearborn the other day. Had the hardest time figure out what it was until I checked online. Looks like Ford might be importing that as well. Surprisingly it didn't have any covers in it.
Before Ford can sell the EcoSport in the US, they'll need to figure out what to do with the Escape/Mariner, and they'll also need to figure out how to make up the difference in costs associated with making the EcoSport compatible with US emissions. Last I heard (and this is just water cooler gossip) selling the EcoSport in the US would cost an additional $8,000/unit over what it costs to make it in Brazil. Unless Ford decides to eat the additional costs, there's no way they can make it up in other areas and no way the EcoSport would sell at that price point.
The EcoSport you saw didn't have any covers on it because it is a current production vehicle...it is no secret. Just like at the auto shows...if the car is in production, the doors are unlocked and you can check everything out. If it isn't in production, the doors are locked and you can't do anything but look at it. Covers and disguises are only used when the car is not in production yet.
maybe ford when using out of country designs should label them 'imported for ford motor co.'like they did with the capri,Americans like imports.
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