Have you ever even heard of the 1956 Ford Edsel? The automaker probably wants it that way. Ford conducted 10 years of research to create the perfect automobile to appeal to buyers, but the Edsel still missed the mark. What mistakes did the Ford brand make?
Why was the Ford Edsel a failure?
In an old article from Time Magazine, the Ford Edsel was referred to as the “car industry’s most famous flop.” The Ford Edsel was a two-door sedan name after Henry Ford’s son, Edsel. In 1957, the automaker had a division created to bring this automobile to fruition. The cost of that was about 10 years and $250 million in research and development. It was supposed to be one of Ford’s new cars, the first in decades.
The Ford Edsel had 18 models to choose from, but that still didn’t help sales. To reach the company’s goals, it had to sell better than most cars on the market. When it first went on sale in September 1957, people were lining up to get ahold of one. But by the end of the year, sales had already fallen to one-third of the initial purchases.
The Ford Edsel was the “wrong car at the wrong time”
Ford tried to explain away the failure of the Edsel by saying it was simply the wrong car at the wrong time. The automaker set out to create a car that would compete with Chrysler’s Dodge and DeSoto sedans and the GM Pontiac, Oldsmobile, and Buick vehicles.
“Studies showed that by 1965 half of all U.S. families would be in the $5,000-and-up bracket, would be buying more cars in the medium-priced field, which already had 60% of the market. Edsel could sell up to 400,000 cars a year.”Time Magazine
Ford ran more studies to confirm that the Edsel was the right choice for this market sector. Research shows that buyers interested in Mercury were younger and more into hot rods. Pontiac, Dodge, and Buick aimed at reasonable middle-age buyers. The Ford Edsel was supposed to fit right in between.
The factories created for this car were able to be used for future models
Ford went so far as to put out a 60-page memo about the procedure to try and find the right advertising agency. After turning down 19 companies, Ford executives settled on Foote, Cone & Belding. After all was said and done, the Ford Edsel cost $250 million.
But the research overlooked a critical area of potential buyers. By the time 1957 rolled around, buyers seemed to want compact cars more than mid-priced cars. “As it turned out, the Edsel was a classic case of the wrong for the wrong market at the wrong time. It was also a prime example of the limitations of market research,” Time noted.
The last Edsel rolled off the production line in 1960. Less than 200,000 units were made from facilities that cost $100 million to build. Ford pivoted to build compact cars in these facilities to try and capture more of the market. The Ford Edsel was unsuccessful, but the brand is still around and quite successful with vehicles like the Ford F-150 and Ford Mustang Mach-E, so not all hope was lost.