Reports this past week indicated that Ford (NYSE:F) and the United Auto Workers are discussing a deal to bring the midsize Ranger pickup back to the United States.
As first reported by the Detroit News on Wednesday, if the deal happens, the Ranger would be made at a factory near Detroit. That factory currently makes the compact Focus and C-Max -- but Ford has said that production of those two models will move elsewhere after 2018.
A new Ranger would be good news for the workers at that factory. But the Ranger alone won't sell enough to keep that factory working at full speed. I think Ford is going to bring at least one other new product to that factory along with the Ranger -- and I think it will look an awful lot like the handsome SUV in that photo up above.
Meet the Ford Everest
That red SUV is Ford's latest, a new model called the Everest. It was developed largely in Australia, and it's being rolled out right now in China, South Africa, and many countries in Southeast Asia.
The Everest is about the size of an Explorer, but it's a very different beast. It's based on the 4x4 version of the current Ford Ranger pickup, a vehicle that has won great respect among off-road enthusiasts in places like Australia.
The Everest has 225 millimeters (8.9") of ground clearance and can ford water up to 800 millimeters (31.5") deep. It has locking differentials, an active transfer case, and electronic aids for hill descent and various off-road surfaces (like mud or rocks). It can tow up to 3000 kilograms (6614 lb) with the 3.2 liter 5-cylinder diesel engine that's standard in the Everest in Australia. In some other markets, it's also available with Ford's 2.0 liter EcoBoost four-cylinder. (If it came to the U.S., it would probably have different engines available, including one or more of Ford's EcoBoost V6s.)
It's also pretty luxurious. In Australia, it's available with a huge panoramic sunroof, Ford's Active Park Assist system, and adaptive cruise control, along with a long list of safety and comfort features.
Reviewers in the Australian automotive media say that the Everest has terrific off-road skills. In fact, in many ways, it sounds a lot like Fiat Chrysler's (NYSE:FCAU) strong-selling (and extremely profitable) Jeep Grand Cherokee.
That's why I think it would make sense for Ford to offer a version of the Everest here in the United States. And I think Ford might have the same idea.
Here's why the Everest could be coming to the U.S.
Ford's Michigan Assembly Plant built about 285,000 vehicles last year. The Ranger is a midsize pickup -- but midsize pickups don't sell in huge numbers nowadays. The best-seller in the segment is Toyota's (NYSE:TM) Tacoma, and it sells about 15,000 a month. Even if the new Ranger is great, Ford isn't likely to sell more than that.
As a general rule of thumb, an auto factory needs to work at over 80% of its production capacity in order to generate a profit. The Ranger alone won't do it for Michigan Assembly. To make that factory as profitable as possible, it'll need some other strong-selling products.
Products like a great new premium SUV.
That's why I think the Everest -- or some version of it -- is coming to the U.S. along with the Ranger. It's based on the Ranger's architecture, so it can be built on the same assembly line. And while the Everest's design would probably have to be tweaked to meet U.S. regulations and market needs, it would be quicker, easier, and far less expensive than designing something else from scratch.
Bloomberg and other outlets reported on Wednesday that a vehicle called the Bronco might also be built at Michigan Assembly. The old Ford Bronco was a brawny 4x4 that was originally designed to take on the vehicle now known as the Jeep Wrangler.
Right now, we don't know anything about the maybe-upcoming Bronco except its name. It's possible that the new Bronco could simply be the Everest, renamed for the U.S. It's also possible that the Bronco could be a new model, based on the Ranger and Everest, that more closely resembles the Wrangler (with an open top, for instance). If the Bronco is a brand-new Wrangler-like model, I think it's likely that the Everest will join it and the Ranger on Ford's assembly line near Detroit.
What do you think? Would you buy a big Ford SUV that had great off-road ability? Scroll down to leave a comment with your thoughts.
John Rosevear owns shares of Ford. The Motley Fool recommends Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.