It's Showtime for Ford's Fusion

More than once, readers have asked me, "If Ford's (NYSE: F  ) Fusion sedan is so popular, why hasn't it beaten Toyota's (NYSE: TM  ) Camry yet?" While the Fusion has made a big dent in the Camry's market share this year, its total sales are still well behind the Camry, which still reigns as America's best-selling car.

Why? The answer is simple, if surprising: The factory that makes the Fusion can't keep up with demand, even though it's running around the clock. Ford hasn't been able to make enough Fusions to catch Toyota -- or Honda's (NYSE: HMC  ) Accord, for that matter.

Ford has been selling all the Fusions it can make -- and soon, it'll be able to make a whole lot more. Photo credit: Ford Motor Co.

But soon, a second Ford factory will begin making Fusions, and Ford's total production capacity will be closer to Toyota's and Honda's. That means it's showtime for the Fusion, but there's a big catch: At the same time, Toyota is making its own big moves to pump the Camry's sales back up.

In this video, Fool contributor John Rosevear looks at the state of the battle to be America's best-selling car and how the increased supply of Fusions is likely to affect both Ford and Toyota.

Ford's string of hit products like the Fusion has done wonders for its profits -- and its stock price. But in order for Ford's stock to soar, a few more critical things need to fall into place. In The Motley Fool's special free report entitled, "5 Secrets to Ford's Future" we outline the key factors every Ford investor needs to watch. Just click here now for your free report.

Read/Post Comments (3) | Recommend This Article (2)

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  • Report this Comment On August 28, 2013, at 12:13 AM, tstorey1 wrote:

    Yes, Fusion has outpaced Ford management's sales estimates. Yes, this relates to strong sales for the Fusion. No, the Fusion is not alone in the strong seller category. The majority of car models sold in the US have outpaced sales estimates as the industry sales rates return to pre crash levels.

    Ford investors should be happy. Ford is being cautious about increasing capacity. Idle capacity is expensive. Something that would have helped them survive the last slump in far better shape.

    The Fusion is in the most competitive segment there is. Ford is loath to make a massive commitment to a market that is dominated by foreign manufacturers. Makes sense to me.

    Ford makes it's money on trucks and will continue to do so. They will always focus on trucks and not Focus' and Fusions as small and mid sized cars have always been a loser for them. Their UAW contract and systems do not allow them to effectively compete in these small to midsized markets.

    Since the days of the Pinto and the Vega, Ford and GM just don't care about smaller cars.

  • Report this Comment On August 28, 2013, at 10:47 AM, TMFMarlowe wrote:

    @tstorey1: Your analysis would have been sound in 2006, but times have changed. Ford knows it can't depend on just US sales of pickups and SUVs anymore. That's why it moved to the One Ford global lineup -- and cars like the Fusion are an important part of its global business now.

    If you don't think Ford cares about smaller cars, you really need to go drive a Focus back to back with something like a Corolla. Times -- and the small-car pecking order -- have changed.

    John Rosevear

  • Report this Comment On August 28, 2013, at 3:44 PM, SkepikI wrote:

    ^ AND its worth noting that Ford is right now making a good profit on each and every Fusion built and sold with very little hanging out on inventory, contrary to the @tstorey 'story line'

    I'd rather have that than the most cars sold any day. Long F the taxpayer's friend.

    (no transcript of the video JR!)

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