Ford's Tiny New Car Could Be a Big Seller

Ford unveiled the Ka Concept in Brazil on Wednesday. The company is expected to begin producing it in 2014. Photo credit: Ford Motor Co.

It looks like a Fusion that shrunk in the wash, doesn't it? It's actually a preview of a new Ford (NYSE: F  ) that could turn out to be a big deal in some far-flung markets.

The Ka Concept, as it's called, is Ford's latest "concept" car. It was revealed on Wednesday at an event in Brazil by the highest-ranking Ford official of them all, Executive Chairman Bill Ford.

Sometimes, when an automaker shows a concept car, it's just an idea, something meant to showcase a new technology, or a new design direction for a brand. That's the traditional idea behind the term. But I put the word "concept" in quotes above because often, a Ford "concept" is a thinly veiled (or not-at-all-veiled) preview of something they plan to produce. 

Ford dropped plenty of hints that its new Ka Concept falls into that latter category. It's clearly a preview of the 2015 Ford Ka. That makes it important. Here's why.

Despite its name, it originated fah from Bahston
The "Ka" -- it's pronounced like "cah," more or less -- is a tiny car that has been part of Ford's global lineup since 1996. Until now, it has always been a "three-door" -- two side doors and a hatchback -- marketed as an inexpensive, low-cost city car. 

An updated version of that original 1996 model is still made in Brazil and sold throughout Latin America. There's also a somewhat newer version, made in a Fiat factory in Poland, and sold in Europe. But neither is a modern, global Ford product.

This car appears to change that. Like its namesake predecessors, the Ka Concept is pretty small, one size down from a Fiesta. But it's very much a modern Ford, albeit a low-cost one.

The Ka Concept is quite small, but designed to maximize interior space. Photo credit: Ford Motor Co.

This Ka has five doors (counting the hatchback), and Ford says that it will comfortably seat five. And it has some amenities that urban folks in places like Brazil and India will appreciate: Ford bragged about its "best-in-class" air conditioning, and it's available with Ford's voice-activated SYNC infotainment system and a central docking station for smartphones and other mobile devices. 

Ford didn't say what kind of engine would power the Ka Concept. But it's clear from what Ford did say that the Ka Concept follows the winning approach that Ford has taken with global models up and down its product line: offer premium features in a well-thought-out package. 

We can safely assume that it will follow the rest of that approach when it comes to market: Ask a premium price, and ensure a good profit for Ford.

You might never see one in the U.S., but it should be a big seller
The Ka was developed by a Ford team in Brazil. It's their second all-new global Ford model. The first, the small EcoSport SUV, will eventually be rolled out to 62 countries, Ford says. It's already on sale in China and India (where it has been a surprise hit), and was recently launched in Russia and Western Europe.

The Ka Concept was developed by the same team that created the Ford EcoSport, which has been a hit in several major overseas markets. It's shown here in Moscow, where it recently went on sale. Photo credit: Ford Motor Co. 

It's not yet official, but Ford dropped some big hints on Wednesday that something very close to the Ka Concept will go into production in 2014. Cars in the global "sub-B" segment -- one size down from what we call a subcompact, like the Fiesta -- are expected to be big sellers in Latin America and South Asia in coming years, Ford says. It may never make it to the U.S., but I expect the production version of the Ka to follow the EcoSport's path to major markets around the world.

That won't hurt Ford's bottom line at all. The Ka Concept is clearly aiming to be a premium offering in that low-cost segment, just as the Fiesta and Focus are in the next two segments up the size ladder. 

Given how well it builds on Ford's well-proven product formula, it looks like Ford could have another global hit on its hands.

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Read/Post Comments (22) | Recommend This Article (17)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 14, 2013, at 12:36 AM, KatVo wrote:

    I remember about old Ka when I am work in France. They have crazy commercials for SportKa, "Evil Ka" that was... so horrible but still make you laugh.

  • Report this Comment On November 14, 2013, at 1:19 AM, Hungryhill wrote:

    Ka = Kia Spectra 5 or more recently the Rio

  • Report this Comment On November 14, 2013, at 5:30 AM, krankcodering wrote:

    1) Make a 2-door.

    2) Change the name. I like Photon

    3) Optional backup camera.

  • Report this Comment On November 14, 2013, at 5:34 AM, DATSUN1967 wrote:

    FORD YOU MIGHT DO GOOD WITH THIS ONE IT HAS A GOOD LOOK TO IT.

  • Report this Comment On November 14, 2013, at 8:03 AM, Lou1s wrote:

    Thanks. It's much more enjoyable to read an article, as opposed to watching and listening to a video.

  • Report this Comment On November 14, 2013, at 9:41 AM, TMFMarlowe wrote:

    @krankcodering: This is a low-cost city car aimed primarily at emerging markets. I'm not sure that adding a backup camera is really the right suggestion.

    @Lou1s, I hear that. But we also have readers (er, watchers) who prefer the videos, so we cater to both.

    Thanks for stopping by.

    John Rosevear

  • Report this Comment On November 14, 2013, at 9:52 AM, TMFMarlowe wrote:

    @Hungryhill: Actually, i think it looks most like an Aston Martin Cygnet. I bet the interior won't be quite as fancy, though. (And I bet it'll be a whole lot more profitable for its parent company, but that's another discussion.)

    I think the Kia Rio is a subcompact, not a sub-B. In terms of global vehicle categories, at least, it's (officially speaking) one size larger than the Ka. But Ford didn't release dimensions on the Ka Concept, so I don't actually know for sure how it compares with the Rio or the Fiesta in terms of size. When I find out, I'll share that in a future article.

    Thanks for stopping by.

    John Rosevear

  • Report this Comment On November 14, 2013, at 10:17 AM, Skaterfs5 wrote:

    Nice little car. It figures that you won't be able to buy one in the U.S. Thanks again for your short sightedness, Ford.

  • Report this Comment On November 14, 2013, at 10:29 AM, Saucey56 wrote:

    I would LOVE to see this in the US, especially for us low-income people living on Social Security incomes! This would be perfect for me to get around town!

  • Report this Comment On November 14, 2013, at 10:43 AM, cityperson wrote:

    Anioher vehicle that looks better then the ones they push in the American market. Thi would be big seller her in the US, but the auto makers will push ugly insted.

  • Report this Comment On November 14, 2013, at 11:04 AM, NoVaEarly wrote:

    Considering that the current Ka sold in Europe is built on a shared Fiat 500 platform and it took Fiat two years to sell 100K 500s in the US. That tells me there isn't a market for a car that small here. Ford has sold over 600K F-150s in the USA this year. A single model selling 15 times as many units with a much higher profit margin. It seems like a waste of Ford's time and resources to market it here.

  • Report this Comment On November 14, 2013, at 1:03 PM, srishi wrote:

    The speeds, weather conditions and driving pattern of US do not allow for tiny sub-compacts to maneuver or drive safely. Safety is uppermost, then fuel efficiency and space constraints. In large cities with good public transport, one should restrict to hose as far as possible. The parking rates itself and finding space to park is a hassle worth avoiding for those with limited incomes.

  • Report this Comment On November 14, 2013, at 1:22 PM, Scottilla wrote:

    I rented one in France a few years ago. It was fine, even driving from Paris down to the Riviera and back. The only disappointment was the gas mileage. I got no better than 30 miles to the gallon on that trip. My Volvo S-60 at home does just as well.

  • Report this Comment On November 14, 2013, at 1:42 PM, LarryK wrote:

    It's not KA. It's KA-AH!

    Howard W.

  • Report this Comment On November 14, 2013, at 1:55 PM, SkepikI wrote:

    JR - Caught this article late, but its one of your better efforts. Thanks, I would not have spotted this on my own even tho I am long F. And a Fan of F Management. This has the look of excellent strategy, well executed and another building block in the "One Ford" strategy. I am always impressed when Managements do what they say and then execute well.

    I also say this is much better than a video. And for the record I am ok with you catering to Video lovers, just make sure you include a transcript for those of us who detest the time and lame factor involved in videos. YOU WRITE TOO WELL TO DISRESPECT IT! (yes I did raise my voice there ha)

  • Report this Comment On November 14, 2013, at 6:52 PM, NoVaEarly wrote:

    European countries use imperial gallons. A US gallon = 3.785 liters. An imperial gallon = 4.546 liters. A car that gets 30 mpg in American will get 36 mpg in Europe because they measure using a different yardstick so to speak. Their fuel also doesn’t contain ethanol, which carries less energy per unit than gasoline, so that 36 goes up to 38mph overseas. At face value a vehicle there gets 26% better economy than the exact same car here. Very few people understand that they are comparing apples to bowling balls when they talk about how great foreign city cars are. Bring them here and they achieve mpg no better than a Corolla was capable of twenty years ago.

  • Report this Comment On November 14, 2013, at 6:56 PM, NPRmyinitials wrote:

    Why post this if I cannot buy it ? Did I miss MPG ? It is the most important thing to me. Just discovered this website, not very good so far.

  • Report this Comment On November 14, 2013, at 11:04 PM, JustJP wrote:

    Park yer Ka in the Ga ra

  • Report this Comment On November 15, 2013, at 10:08 AM, TMFMarlowe wrote:

    @NPRmyinitials: We're about investing here. We cover it because it's important to Ford's business. It's part of a larger strategy to expand Ford's sales in other parts of the world. I expect that strategy to boost Ford's stock price by quite a bit over the next few years. Stick around, we'll explain more.

    Ford hasn't released any MPG figures for this yet -- they didn't even tell us what the engine would be. Right now, it's just a preview.

    Thanks for stopping by.

    John Rosevear

  • Report this Comment On November 15, 2013, at 10:11 AM, TMFMarlowe wrote:

    @NoVaEarly: So cars like the Fiesta and Focus aren't important in the U.S. because the trucks out-sell them? Everyone I've talked to at Ford -- and that includes the CEO and CFO -- would sharply disagree.

    Ford apparently doesn't think it makes good business sense to market the Ka in the US right now. But that might change someday.

    John Rosevear

  • Report this Comment On November 15, 2013, at 10:14 AM, Grandpastu wrote:

    If it's so inexpensive, where's the MSRP? Also how about some specs!

  • Report this Comment On November 15, 2013, at 12:51 PM, TMFMarlowe wrote:

    @Grandpastu: Geez, read the article. Ford hasn't released any specs yet, and it's unlikely to be sold in the U.S. anyway.

    John Rosevear

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