AFSCME 3357-HOF'S BLOG

From the WTF File: No Bull
Ford Five Hundred to Change name to Taurus

Exit Taurus, enter New Taurus. I'm at a loss to explain this one. I'll grant you, the name Five Hundred sucks. It has nothing to do with anything. Supposedly though, Ford had lots of reasons for not naming the car Taurus to Begin with. The existing Taurus was still Ford's most popular car, but it had a lousy resale value that might risk blowing the profitability of any successor. In the past week the major Ford-related headline was that Ford surrendered 3rd place in market share domestically to Daimler Chrysler. Ford's sales fell 19% in January. A big part of that was the retirement of the Taurus, the car that was Ford's top selling passenger car from the day it was introduced until the day it died. Perhaps Ford was irked that you could go to your local Ford dealer and buy TWO barely-used 2007 Ford Taurii for the $24,000 cost of a well-equipped Fusion or a moderately equipped Five Hundred. At $24,000 the Taurus couldn't cut it. At half that price, the Taurus is a steal. One of my coworkers may be picking up a pair of them fairly soon.

It's one thing to just say no to fleet sales. It's another thing to make up market share and pay fixed costs without fleet sales. For a manufacturer faced with this dilemma, the intelligent solution seems to be to isolate fleet-sales into models that are not marketed at retail. In doing so, low resale values may hit the brand but don't necessarily hit the models you are selling retail. Until last fall, that's exactly what Ford did with the Taurus. As long as you can make even a modest profit on the fleet sales, go ahead and sell the fleet cars. If you don't, your competitors will. If your competitors make the sales, their dealers get the profitable used-car sales that follow, making their dealerships strong.

The big winners on the cancellation of the Taurus are the Hyundai Sonata and the Chrysler Sebring. The new Sebring is not as nice a car as the old Taurus. The Sebring's engine and transmission are barely on speaking terms. It's trunk is too small. Its interior was designed by a committee of blind men. The Sonata is basically an okay car, but it has a vaguely offensive odor to it. Then again, I suppose that in the rental car market, a "vaguely offensive" odor is better than average.