2013 Ford Fusion Titanium. Photo credit: Ford Motor.

I hate tossing around the term "game-changer," but every now and then the shoe fits. Consider the time around 2006, when Ford (F 0.08%) had to dish out roughly $2,000 in incentives to sell its vehicles because nobody wanted to buy a Ford car. That caused Ford to rack up $30 billion in losses between 2006 and 2008. Ford was closer to competing with Starbucks with its break-room coffee than it was competing with Toyota (TM 1.07%) and Honda in smaller, fuel-efficient vehicles.

Those days are gone, and Ford can't keep enough of its Fusion at dealerships. In some markets, the Fusion is selling in 20 days; that's three times faster than the industry average! Not only are Americans clamoring to get the ride, but Ford is also having great success with the vehicle overseas -- something no analyst predicted half a decade ago. The Fusion is changing the game for Ford's success in the U.S. and globally. Here's why consumers love the ride, and why Ford investors do, too.

Wait ... stylish?
One of the biggest points of emphasis on the Fusion was creating its unique style, something that isn't seen often in the typically bland mid-size sedan segment.

"My design brief to the team was to do an absolute drop-dead gorgeous head-turner," said J. Mays, Ford's head of global design, according to the Detroit Free Press. "And it was to look $10,000-$15,000 more expensive than it is."

Consider it a job well done, Mr. Mays. Not only does it look stunning next to bland competitors, but Ford has crammed quite a few features into the ride. It's the first sedan to offer gasoline, hybrid, and plug-in hybrid powertrains. In addition to its award-winning line of EcoBoost engine options, it's loaded with popular tech features. Those include a Lane-Keeping System, adaptive cruise control, active park assist, and MyFord Touch.

Those give consumers plenty of reason to buy, and it shows, with sales of the Fusion up 13.4% this year -- and improving each year as the word gets out that Ford's Fusion is impressing critics and consumers alike. Consider some of its recent awards.

  • U.S. News & World Report's "Best Car for the Money."
  • 2013 "Green Car of the Year" award from the Los Angeles Auto Show.
  • Kelley Blue Book's "Best Redesigned Vehicle" of the year.
  • U.S. News & World Report's 2013 "Best Cars for Families."
  • U.S. News & World Report's "Best Mid-Size Car" (for three straight years).

Ford's Fusion has a chance to do two things that haven't been done in some time. Right now the flashy sedan is on pace to break 300,000 annual sales in the U.S., something only the F-Series has done for Ford in nine years. It also represents the best chance for an American-made vehicle to take the No. 1 passenger car sales crown -- which has been held by Toyota's Camry for 15 of the past 16 years.


Graph by author. Information from Automotive News DataCenter. 2013 projected from first six months.

The Fusion's success has put a dent in Camry sales and has been one reason the Camry is one of only two vehicles in the top 20 rankings to decline in sales this year. Fusion buyers have been thrilled, and oftentimes a happy consumer equals a thriving business, rewarding investors in the process. Here's why Ford investors are happy regarding the Fusion.

Investing takeaway
The Fusion has been one of the key vehicles in Ford's attempt to profitably grow market share. It's worked: Ford's market share in the U.S. has increased more than that of any other full-line automaker this year. Not only that, but because supply is so limited, dealers aren't negotiating on price and the Fusion is selling at a $1,176 premium to the industry average and a $2,378 premium to Toyota's Camry, according to Bloomberg. 

Following the supply-and-demand theme, we know that the premium is great, but to maximize profits you need to hit the equilibrium between price and sales. That's exactly what Ford is planning to do, starting right now. Ford is investing $555 million into its Flat Rock Assembly plant to bring additional production of the Fusion online. Ford will hire 1,400 new workers and expects production capacity to increase by more than 30% -- enabling production of 350,000 units annually. Going forward we'll probably see transaction prices for the Fusion decline slightly, but Ford's overall profits from the vehicle will improve.

For investors it goes beyond just maximizing profits, although that's a huge plus. The Fusion is expanding Ford's global footprint, which is years behind crosstown rival General Motors. The Fusion is going to be key if Ford wants to reach its goal of doubling its market share in the largest and fastest-growing automotive market -- China. Fusion is but one of Ford's recent success stories, and if the trend continues investors are likely to see more than just the 73% rise in share price over the last year.