The U.S.-based automaker Ford Motor Co., along with fellow American company General Motors Corp., has taken a lot of heat for depending too much on SUVs and trucks to meet sales targets. Both companies are hurting, and the general consensus is that they missed an opportunity in the profitable 1990s to develop better cars when they still had extra money from the sales of bigger vehicles.
So it might come across as a little weird that Ford Sales and Service Korea Inc. recently launched a sport utility truck version of its Explorer SUV in Korea, a country traditionally not desirous of big American trucks or SUVs.
GM, via subsidiary GM Daewoo Auto & Technology, has been successful here by ignoring large vehicles, choosing instead to focus on small cars, such as the Matiz (although the Cadillac Escalade can be purchased here for 116.4 million won, or $126,000).
A sport utility truck is yet another manifestation of the crossover craze well underway among the world`s automakers but usually combining car platforms with SUV shapes. The SUT combines the large boxiness of an SUV with the bed of a truck. Ford`s model, called the Explorer Sport Trac, is the first imported SUT in Korea. The vehicle combines the Ford Explorer SUV with the company’s F-150 pickup truck, which leads the American market in pickup truck sales.
The only other SUT in the Korean market is Ssangyong’s Actyon Sports, introduced last year. The company sold 10,900 of them domestically in 2006, making the model the company`s hottest selling vehicle in the SUV/SUT category.
Hyundai Motor Co. led the category, selling nearly 51,000 Sante Fe SUVs in its home market last year. Ford Korea`s total sales last year were just 1,688 vehicles.
The SUT market is not big in Korea, so sales will be low, Song Sang-hun, analyst at Hungkuk Securities Co. Ltd., said in an e-mail. It also does not help that the Sport Trac only comes with a gasoline engine, he said. Modern diesel technology offers fuel economy benefits.
Ford Korea does not plan the Sport Trac to be a high seller, nor is it targeting Ssangyong buyers, said Han Bong-seok, Ford Korea’s marketing director.
“More and more people are interested in import cars and new niche segments,” Han said.
The Dodge Dakota pickup truck is the niche target Ford wants to hit. The Dakota had sales of 127 last year.
“Sport Trac is an SUT, so as with Ssangyong’s Actyon Sports, its appeal is limited to enthusiasts of this type of vehicles,” said Kim Jin-man, a Ford dealer in Seoul. “Some may consider it to be a little expensive, but so far customers seem to prefer Sport Trac to Dakota, which is in the similar price range.”
Ford vehicles here include Lincoln luxury cars, as well as Ford sedans and SUVs. (People interested in a super-cool Mustang GT or Shelby are on their own, as Korean noise regulations allow only the V6 Mustang.) The SUT enhances Ford`s current lineup in Korea, Han said. The Sport Trac, partly because of import taxes, is priced out of the reach of most people in the market for an Actyon, so sales will be mostly to people who can afford a second vehicle, Han said.
By Choi He-suk and Gary Anglebrandt
May 14, 2007 | The Korea Herald (publish date at link is incorrect)