Once-dominant Ford Explorer will relaunch with improved fuel efficiency

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Ford Motor Co. is trying to reverse its downward trend of Explorer sales.
By Peter Whoriskey
Washington Post Staff Writer
Thursday, July 22, 2010

In the boom years, when living large went unquestioned, the Ford Explorer ruled the roads. Bigger than necessary and a fuel hog, the Explorer flew out of showrooms by the hundreds of thousands year after year, becoming the nation's best-selling SUV over a decade.

Then times changed, a recession intervened and the cultural icon seemed like a relic. So on Monday, Ford will reveal what company officials have called an "extreme makeover," the re-invention of an emblem of boom-time excess and environmental wantonness.

"You won't have to be ashamed when you drive into the driveway and the neighbors come over," Ford Executive Vice President Mark Fields said in an interview.

In its new incarnation, Ford says, the Explorer will get as much as 30 percent better fuel economy.

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Its pricing, moreover, is built on the premise that consumer values have changed: While the old Explorer offered a more powerful engine as an option, the new one gives consumers the option of paying more for a fuel-stingy "Ecoboost" engine.

And with the Explorer's new styling -- a closely guarded secret until Monday -- gone is some of the pretension that by driving one, you were bound for a rugged off-road adventure, rather than merely venturing beyond the cul-de-sac to drop the kids off at soccer.

"It's more suburban than it ever was," said Jessica Caldwell, an analyst at Edmunds.com. Whether the revamped Explorer can revive sagging sales -- they really began to plummet in 2005 -- will be closely watched for signs of how the recession has altered consumer tastes.

During the truck's heyday of the late '90s and early '00s, Ford sold more than 400,000 Explorers annually. But in 2000, congressional hearings highlighting rollover accidents involving the Explorer and Firestone tires tarnished its reputation. The company made the truck less prone to roll over, and it continued to sell more than 400,000 annually into 2001 and 2002. But increasing competition and the growing worries over oil dependence caused by the Iraq war, as well as the growing conservation ethic, eventually squashed its sales. Last year, only 52,000 were sold, according to figures from Edmunds.com.

Some said Ford's decision to relaunch the Explorer showed that the demand for bigness -- big homes, big cars, big meals -- has revived.

"Obviously, it was too soon to write the obituary for excessive consumption," said John DeCicco, senior lecturer at the University of Michigan and a former senior fellow for automotive strategies at the Environmental Defense Fund. "It was naive to think that a spike in gas prices in '08 would usher us into a new era."

But given the demand, DeCicco praised Ford's decision to meet it with a more fuel-efficient vehicle.

"All of the industry has been chastened now," he said.

Ford officials said the new Explorer has two primary advantages over the old. First, though its size hasn't been reduced -- it now seats seven instead of five -- it gets better fuel economy. With the standard V-6 engine it is expected to get about 17 1/2 miles per gallon in the city and about 25 on the highway -- up from 14 city and 20 highway. Second, it offers a far smoother ride, they said.

"We want to change people's perceptions of what an SUV can deliver," Fields said.

In marketing the new vehicle, too, Ford is tapping into the growing public recognition of how important the industry is to the economy, touting 1,200 jobs added to the Chicago plant where it will be assembled. The federal government's decision to bailout Ford's domestic rivals, Chrysler and General Motors, was underpinned by studies showing how many jobs in the U.S. economy depend on the auto industry. On Monday, when the redesign will be made public, Ford Executive Chairman Bill Ford is expected to be in Chicago.

Company officials said about 600 more jobs will be created at suppliers, which number more than 100 across 23 states. About 65 percent of the value of an Explorer is created by the suppliers, and about 90 percent of the current Explorer is considered domestic content, Ford says.

Moreover, as the Obama administration seeks to double U.S. exports, Ford has noted that the Explorer is the company's most popular export. The top countries to which the United States exports vehicles are Canada, Germany, Mexico, Saudi Arabia and China, according to figures from the American Automotive Policy Council.


© 2010 The Washington Post Company

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