Ford Is Developing A New Line Of Hybrids To Take On The Toyota Prius

August 22, 2014

When it comes to alternative vehicles, no automaker can match Toyota's success on the sales floor. Although Honda beat Toyota to the hybrid punch a decade-and-a-half ago, the Toyota Prius ran away with shoppers' hearts (and wallets), ultimately delivering a death blow to the Honda Insight.  

Now, Toyota seems as if it's moved on to something new -- namely, fuel cells -- but many car companies believe there's plenty of profit still to be made in hybrids. One of those companies is Ford.

According to Reuters, Ford is planning a new line of hybrid vehicles to compete with Toyota's hugely popular Prius series. Two sources report that the first model of that as-yet-titled line is code-named "C240" (likely because of the C2 platform on which it will be built). It should debut late in 2018 as a 2019 model. Plans are to build the C240 at the Wayne plant in Michigan, with production estimated at around 120,000 units per year.

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At first glance, that may not seem like such big news. After all, Ford already has a number of hybrid vehicles in its lineup, right?

Right, but the hybrids that Ford sells today were designed as gas-powered cars, then adapted for hybrid powertrains. If rumors are correct, the C240 would be built and marketed solely as a hybrid, just like the Prius. Also like the Prius, Ford's new hybrid will come in different configurations, ranging from run-of-the-mill hybrids to plug-ins.

Will the C240 pay off for Ford? That depends on several questions. One of the most important is: will hybrids still be a growth market four years down the line? We think they will, though electrics should be slowly gaining share. (Fuel cells? Who knows?)

However, the more important question is whether Ford can price the C240 competitively with plug-in hybrids and electric vehicles, which will likely have dropped in cost by 2018. Today, vehicles like the Chevrolet Volt are suffering because they're priced $10,000 or $15,000 above gas-powered equivalents. In four years, will economies of scale have brought costs of those vehicles in line with conventional hybrids? Stay tuned.    


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