Posts
Is there a self-respecting automotive enthusiast alive, myself included, who wouldn’t love to see Ford resurrect the Bronco? Answer: Absolutely, the fun loving folks in Auburn Hills.
Ford may not need to develop a new Bronco, but it absolutely should. And it should use the Jeep Wrangler as its benchmark.
The Wrangler nameplate is so robust that it survived the under-funded ineptitude of AMC, the lean independent years, the cost cutting Cerberus era, and even the culture-challenged Mercedes decade. Wrangler transcends traditional logic of automotive success. It’s not fuel efficient, space efficient, quiet, comfortable or even particularly reliable, yet it thrives thanks to the enduring emotional connection consumers experience with it.
Consider the Wrangler’s track record: When total car sales dipped 39 percent between 2005 and 2009, Wrangler sales rose 6 percent. Since then, Wrangler sales have increased 160 percent while the industry is up 67 percent. If Wrangler were a mutual fund it would have crushed the Dow on the way down and on the way back up.
Despite all the love, the Wrangler is all alone. Others have tried (Samurai/Tracker/FJ Cruiser/Xterra) but none had the brand, legacy and/or form factor that a new Bronco could enjoy. We love the Wrangler like few other vehicles, in much the same way we could love a new Bronco.
We can thank recent growth in the compact/mid-size pickup segment for the Bronco opportunity because, without the investment in a new Ranger, a Bronco resurrection would not be viable (see Ford May Bring Ranger Back To US in 2018). Moreover, a new Bronco would supplement the Ranger in filling the void at the Michigan Truck Plant left by the departing C-Max/Focus. This idea is not new, but what form should the new Bronco take?
There has been discussion of Ford reissuing the Bronco using the T6 Ranger-based Everest (see Let’s Break Down The Ford Ranger and Bronco Rumors, Shall We?). As the logic goes, the rumored loss of Explorer’s D4 platform mates (MKS/ MKT/Flex/Taurus) will transform today’s Explorer into a scale-challenged orphan ready for replacement by a modified Everest. However, Explorer exited the recession with strength, posting double digit growth in each of the last six years and is on pace to move 270k units this year. It may not be nearing its pre-recession glory of 400k annual units, but it justifies itself without platform siblings. Replacing the current unibody, FWD-biased Explorer with a RWD, body-on-frame Everest and all the associated packaging and dynamic challenges that decision brings would be a mistake. Grand Cherokee proves there is room in the mid-size SUV segment for a real off-roader, but Ford should let 4Runner, Grand Cherokee and the new Discovery compete for these rare buyers. The real opportunity is in targeting the peerless Wrangler. Purists rejoice: That means an open-top Bronco, but if Ford wants to do it right it has much to learn from Wrangler.
One of the biggest factors driving Wrangler’s growth over the last decade has been the introduction of the four-door Unlimited in 2007, with a take-rate of 70 percent. Purists may bemoan a four-door Bronco, but without one the Bronco cannot generate the sales volume necessary to justify itself. A two-door only Bronco would end up joining other promising-but-dead products like Excursion and T-Bird. The new Bronco must be an off-road capable, open-top, emotive, fun machine offered in two- and four-door wheelbases.
How many Broncos can Ford sell and how much will it cost to develop? Wrangler is on pace to move 230k units this year. Based on FCA’s continuing investment in Wrangler, the automaker clearly sees a bright future in the nameplate. Ford can expect a mix of Wrangler conquest and new sales. Can Ford wrestle away 10 percent of Wrangler’s market and find another 25k takers a year? Almost certainly. If Bronco development cost — not shared with the new Ranger — reaches $1.5b and the Bronco lifecycle is eight years, Ford will have 400k units over which to amortize the development cost. That equates to about $3,800 per unit, an economic decision roughly equivalent to the Expedition/Navigator twins that attracted Ford’s investment based on combined sales of 42k to 57k units in each of the last seven years.
Will it cannibalize other Ford nameplates and what about CAFE? An uncompromising Bronco, as described here, has only one competitor so the cannibalization question is essentially moot. As for CAFE, absolutely a new Bronco would have a detrimental impact, but these vehicles would achieve a “light truck” classification, thus diminishing their regulatory impact. For a more complete discussion of CAFE I recommend Derek Kreindler’s excellent article, How CAFE Killed Compact Trucks And Station Wagons.
Developing a Bronco to battle Wrangler in its private niche is a sound business decision that almost every enthusiast can get behind. Ford, please resurrect one of the most storied nameplates in automobiledom, and aim it at the Wrangler. Do so, and the only losers will be Ford product managers who are not compensated like Wall Street fund managers.
