Fiesta Boosts Ford's Performance

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The newness, style and fuel-efficient technology of Ford Motor Co.’s (F) Fiesta increased its popularity among the young buyers. Boost in sales and improvement in market share will enable the automaker to become the top auto brand.

Ford sold 45,831 units of Fiesta in 2013, surpassing Toyota Motor Corp. (TM) and Scion’s three subcompact vehicles’ sale of 32,510 units. Ford recorded an 80% retail share increase in the first half of 2013 compared with the same period in 2009.

In comparison, the overall industry recorded a 35% rise. The retail share of Ford increased 3.1 points to 12.5% during the same period, driven by improved sales of Fiesta, Focus, C-MAX, Escape, Fusion and Explorer, which cumulatively accounted for 70% of the increase.

The new Fiesta is equipped with MyFord Touch drivers connect technology and will also feature a 1.0-liter EcoBoost engine soon. In addition, the car also features a rear view camera, leather seats and sunroof, which are not available in many similar cars. Moreover, the Fiesta SE with Super Fuel Economy package offers an EPA combined fuel efficiency value of 41 mpg on highway, thus making it the first subcompact to go above 40 mpg.

These technologies attract young buyers who prefer unique features in small, fuel-efficient cars suitable for urban lifestyle. According to Ford, 54% of the buyers opt for Fiesta because of its voice-activated technology – SYNC . Thus, Ford captures 46% of the younger generation buyers compared to Toyota and Scion, which have an average of 36%.

Recently, Ford revealed that it is upgrading its 2014 C-MAX Hybrid, which will hit the stores in December this year. The automaker is eyeing the top rank in the hybrid market with fuel efficient vehicles. The new version of C-MAX Hybrid offers better fuel efficiency, thus providing greater satisfaction to customers.

The new Ford C-MAX Hybrid features upgraded powertrain software together with favorable hardware changes. The hardware modifications include changes in the gearing, which will make the transmission drive ratio more efficient.

Ford currently carries a Zacks Rank #2 (Buy). Other major automobile stocks worth considering are General Motors (GM) and Volkswagen AG (VLKAY). While Volkswagen carries a Zacks Rank #1 (Strong Buy), General Motors carries a Zacks Rank #2 (Buy).

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