Is Ford Making a Mistake That’s Causing Bronco Sales to Drop?
The Ford Bronco is not a luxury vehicle, but Bronco buyers may be paying luxury vehicle prices for this iconic SUV in 2024. Supply chain limitations have naturally shifted the Ford Motor Company’s aim from sales to profits, and sales have dropped. Whether this is a result of limited supply or ‘trimflation,’ it is clear that buyers will be paying more if they are lucky enough to get access to a Ford Bronco.
U.S. Bronco sales falling in 2023
According to Ford Authority, U.S. Bronco sales fell by 16.37% in the second quarter of 2023 compared to 2022 sales. Ford was able to sell 31,269 Broncos in the 2nd quarter of 2022 versus 26,150 units in 2023. However, year-to-date (YTD) sales were up slightly from 54,842 units to 58,580 units, or 6.82%.
Ford Authority blames supply on the sales shortfalls, as the Bronco is massively popular. If buyers are willing to pay, higher trim levels are increasingly available.
While Bronco sales decreased in the U.S., Bronco Sport sales increased, rising 12.94% for the second quarter of 2023 vs. 2022. Sales increased by 7.85% for the Bronco Sport, with YTD sales reaching 58,580 models for the 2023 year by the end of Q2. Overall sales for both members of the Bronco family are nearly tied in their number of sales.
Are base models going extinct at Ford Motor Company?
Ford announced that the base-level Ford Bronco will not appear in its 2024 lineup. The base model of the 2023 lineup starts at $34,890. The 2024 Ford Bronco Big Bend, effectively the new base model, starts at $39,130. The new “starting” Ford Bronco costs $4,240 more than the original base model.
The move may be a simple response to supply and demand. Ford could not keep up with the demand for its base Ford Bronco, but the lessened demand for more expensive trims brings in higher profit margins despite less sales. Others say that eliminating the base-trim Bronco was an effort to eliminate redundancies, as the models were essentially the same.
Increased price tags and no base models also allow Ford Motor Company to standardize some of the high-level features of the Bronco. They no longer offer 8-inch infotainment screens and now only offer optimized 12-inch screens. The heavy-duty modular front bumper now comes on the “base” model as standard equipment. The elevation of the entire line has also made Ford increase options, such as new packages and exterior colors.
Is Ford’s drop in Bronco sales a mistake?
An August article in The Autopian notes an auto industry trend to prioritize higher trim levels because of the improving but still present supply chain crisis. It’s not that people aren’t buying, but the automakers are unable to produce enough vehicles to keep up with demand. In order to maintain profits, they sell trim levels with a higher profit margin. This action has been called “trimflation.”
Some people may consider “trimflation” to be immoral price gouging, but it’s actually simple economics. Companies almost always increase prices when demand increases. Limited supply generally increases demand.
Despite the favoritism of higher trims in response to supply shortages, many people still wonder if Ford is making a mistake. They wonder if Ford’s “greedflation” will price people out of the market. But the starting MSRPs of the 2024 Broncos are only slightly higher than other popular SUVs. The 2024 Chevy Blazer starts at $35,400, and the 2024 Jeep Wrangler starts at $31,895. The fully loaded Ford Bronco Raptor costs more than $90,000.
Ford’s future may be impacted by worker strikes, supply chain woes, and decreased demand due to increased interest rates. For now, their move to focus on higher trim levels is strategic and will keep profits elevated despite sales decreases.