Ford Has a Lot Riding on the New Bronco Family

www.fool.com
4 min read
standard
The 2021 Ford Bronco and 2021 Ford Bronco Sport will help Ford gain market share from Fiat Chrysler's Jeep brand and (hopefully) support a return to profit growth in North America.
Last week, Ford Motor (NYSE:F) finally revealed its long-awaited Jeep fighters: the 2021 Ford Bronco and 2021 Ford Bronco Sport. Ford first announced that it would revive the iconic Bronco nameplate in January 2017, but because of the long development process typical of the auto industry -- and the need to get these products right -- the new Bronco family is only now coming to market.

The Ford Bronco is a rugged SUV targeting the off-road market currently dominated by Fiat Chrysler's (NYSE:FCAU) Jeep brand (especially the Jeep Wrangler). The Bronco Sport is a smaller, versatile SUV that is also suitable for off-roading. If the new Bronco family becomes successful, it could help bolster Ford's sagging profitability in North America.

The Ford Bronco returns

Ford has been stoking investors' hopes with respect to the Bronco for several years. In 2018, Ford announced that it would discontinue virtually all of its car models in North America: the Fiesta, C-Max, Focus, Fusion, and Taurus. Those models were losing money, and the goal was to replace that volume by expanding the company's lineup of crossovers, SUVs, and trucks. Those segments are all profitable today and have grown in recent years. To support this strategic shift, Ford's 2018 five-year business plan called for just 6% of its investments in North America to go toward cars, down from 33% in its 2015 plan.

The 2021 Ford Bronco is an important piece of that strategy. In a presentation last year, Ford said that discontinuing the Focus and C-MAX and changing over the company's assembly plant in Wayne, Michigan to build the reintroduced Ford Ranger and Bronco (which share a platform) would boost annual operating profit by more…
Adam Levine-Weinberg
Read full article