3 Cars With Jaw-Dropping Potential

Three Foolish experts name the new cars with the most potential to shake up the market.

By John Rosevear, Rich Smith, and Travis Hoium – May 24, 2015 at 11:08AM EST

What kind of car has "jaw-dropping potential"?

Automakers release new models every year. Most of them are just incremental upgrades (at best) over the cars they replace. They're a little roomier, a little quieter, a little more fuel-efficient. That's all fine, but it's not the kind of thing that gets most investors' attention.

The ones that do are the new cars that redefine categories, create significant new categories, or represent a major leap forward for the automakers in question.

Three of the Fool's car-minded specialists recently sat down to nominate recent new models that seem to have "jaw-dropping" potential in one or more of these ways. Here's what they came up with.

BMW's i-cars could transform the company
Travis Hoium: The Tesla Motors Model S proved that electric vehicles had a market, but I think BMW's (BAMXF 0.52%) i-Series of cars has the most potential in this booming market. Launched in 2014, BMW's i3 is already the third-best-selling electric vehicle in the U.S. so far in 2015, with 3,087 units sold, and the i8 plug-in hybrid is sold out for its first year of production.

The gorgeous, fast -- and super-fuel-efficient -- BMW i8 plug-in hybrid sports car is already sold out for the year, BMW says. Source: BMW Group.

What's exciting about BMW's move into electric vehicles is the engineering expertise and sheer scale the automaker brings to the table. The i3 took lightweight construction to the next level with an entire chassis built out of carbon fiber, making it 40% lighter than the Model S (albeit with a shorter range). BMW is working with Toyota on post-lithium battery technology. Could that bring 300-plus mile range to a BMW?

With 1.8 million vehicles sold in 2014, BMW also has the scale to bring to market luxury electric vehicles that feature the performance we've come to expect from the company.

The i3 and i8 are small sellers for BMW today, but they could transform the company's future. These vehicles have proven wildly successful in their first year on the market, and the high torque of electric vehicles plays into BMW's high-performance reputation, so they're a match made in heaven. Potentially, the i-Series of vehicles could revolutionize one of the most iconic car companies in the world. That's saying something.

Ford's all-new F-150 is the one to watch
Rich Smith: Mind if I stretch the definition of "car" a bit? How about if I take off the trunk and install a pickup box instead? Because if you ask me, the vehicle with the most potential to significantly benefit an automaker this year -- and most years -- is Ford's (F 0.80%) F-150 line of pickup trucks.

Early sales of the all-new 2015 Ford F-150 have been extremely strong, and transaction prices have been very high. Source: Ford Motor Co.

It's a well-known truism that large trucks and SUVs drive profits for U.S. automakers, and that's particularly true for Ford's F-150. TrueCar.com notes that the average manufacturer's suggested retail price on a 2015 Ford F-150 "4WD Supercrew 5-1/2 ft Box Lariat" (TrueCar's chosen exemplar for the model) is $43,103. That's 38% above the average car cost in the U.S. today.

What's more, Ford sells a lot of these high-priced F-150s. Through April, 2015 U.S. sales of the F-Series (which includes the F-150 and its Super Duty siblings) have totaled 240,139 units, meaning Ford is outselling rival General Motors' (GM 0.60%) Chevy Silverado line of trucks by a good 39%.

Granted, some experts have voiced worries that Ford's switch away from steel, and toward using pricier aluminum to build the bodies of its trucks, will impact profit margins. Also granted, these fears seem to be materializing, with Ford's net profit down more than 6% last quarter. At the same time, though, the price of aluminum has declined significantly of late, bouncing along a floor value of about $0.80 a pound.

Aluminum prices today are down roughly 15% over the last six months -- and down more than a third from their recent highs in 2011. As Ford learns the ropes of building trucks out of aluminum, and lower prices of the metal itself begin working to its benefit, I expect F-150 sales will continue to drive the automaker's profits.

The new Chevy Malibu is a $300 million winner for GM
John Rosevear: It's just a family sedan, and it replaces a car that has been kind of a dud for GM -- but the all-new-for-2016 Chevrolet Malibu is going to be a much bigger deal than you might think. Here's why.

The 2016 Chevy Malibu is a clean-sheet redesign that has the potential to jump to the head of the super-competitive midsize sedan class. Source: General Motors Co.

Despite the recent boom in SUV sales, midsize family sedans remain the best-selling vehicles in the U.S. For the last few years, sales have been led by the "big four": Toyota's Camry Honda's Accord, Nissan's Altima, and Ford's Fusion, which got a huge sales boost from its impressive redesign for the 2013 model year.

Meanwhile, the current Malibu, which debuted around the same time as the Fusion, has been a relative lemon. It's not a bad car, but this is a hyper-competitive segment, and it missed the mark. While GM's quality ratings have been pretty good lately, and most of its latest models have been serious contenders, the Malibu's dull styling, tight backseat, and so-so fuel economy made it an OK choice, but not a great one. Sales have lagged far behind those of the leaders.

The Malibu's sales were far behind those of the "big four" sedans in 2014. GM hopes the new car will sell better, while generating more profits per sale. Source: Automotive News.

The new Malibu changes all of that in a big way. Gone is the bland rental-car look, replaced by a sculpted body that resembles (but doesn't copy) the impressive full-size Chevy Impala. The Malibu's rear-seat room might now be best-in-class, and the interior has been seriously upgraded.

Under the skin are more big changes. The Malibu rides on an all-new GM architecture that incorporates the company's latest thinking on weight reduction. It's 300 pounds lighter than the old car, despite a longer wheelbase. That weight reduction will improve both handling and fuel economy. Speaking of fuel economy, a new hybrid version uses the technology GM developed for the new-for-2016 Chevy Volt. GM expects it to be EPA-rated for 47 miles per gallon in combined driving -- ahead of most of its rivals.

The upshot is a car that could bring many new faces to Chevy showrooms if the company markets it effectively. This thing should sell like hotcakes. And for GM investors, the best part is this: While the current Malibu is solidly profitable, GM says this one will be even more profitable, to the tune of $1,500 per car. Put another way, the new Malibu could add $300 million or more to GM's bottom line next year all by itself.

That's not bad for "just a family sedan."

3 Cars With Jaw-Dropping Potential

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