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Ford Motor Company (F)’s Escape Sets a New Record

Ford (F) General Motors Company (GM)We already knew that Ford Motor Company (NYSE:F)’s Escape was a hit. But now it’s official — and Ford wants to brag a little.

Ford Motor Company (NYSE:F) said on Wednesday that the Escape has set a new record for U.S. sales of a compact SUV, with more than 150,000 sold in the first half of 2013.

That’s more than its key rivals, Toyota Motor Corporation (ADR) (NYSE:TM)‘s RAV4 and Honda Motor Co Ltd (ADR) (NYSE:HMC)‘s CR-V, managed. And the good news for Ford Motor Company (NYSE:F) is that many of those Escapes were sold on import-friendly turf.

Ford muscles in on the imports’ turf
In the last few months, Ford Motor Company (NYSE:F) executives have been stressing the big sales gains that the company has made in parts of the U.S. that are traditionally thought of as “import” territory.

These are mainly the coastal areas of the U.S, including California — a market long dominated by Toyota Motor Corporation (ADR) (NYSE:TM), in which the Detroit brands have mostly been afterthoughts in recent years.

But that is changing: Strong new Ford products like the Escape, as well as the Fusion, the C-Max Hybrid, and Ford’s small cars, have been going head-to-head with popular Toyotas like the Prius and Camry — and in many cases, winning.

Sales of Ford’s hybrids have boomed in 2013, while Prius and Camry sales were actually down in the first half of 2013. Now, Ford is adding a second assembly line to increase production of the Fusion — a move that could cause more headaches for Toyota Motor Corporation (ADR) (NYSE:TM) when those additional cars start hitting Ford dealers this fall.

The Escape has been on a similar path. Nationwide, sales of the Escape were up a little more than 23% in the first half of the year, but in some key markets, the gains were significantly bigger. Ford Motor Company (NYSE:F) sales analyst Erich Merkle says that retail registrations of the Escape — these aren’t fleet sales — were up 33% in coastal U.S. markets, traditionally the import brands’ strongest territory.

The Ford Escape is outselling both Toyota and Honda in 2013. Photo credit: Ford Motor Co.

Stealing sales directly from Honda and Toyota
A lot of those sales are what the industry calls “conquest” sales, which are sales where a customer trades in a competitor’s product. Ford says the conquest rates for the Escape were 58% in San Francisco, 54% in New York and Los Angeles, and 53% in Boston. Anything above 50% or so is considered very good.

And in all of those markets, the top competitive conquests were either Toyota or Honda Motor Co Ltd (ADR) (NYSE:HMC).

This is exactly the sort of thing Ford investors have been hoping to hear for a few years now. Ford Motor Company (NYSE:F)’s much-talked-about product overhaul has led to a line of cars and trucks that are clearly far better than anything the company has done before and far more competitive with the import mainstays.

But it has been an open question for a while: Would consumers who had become loyal to brands like Toyota and Honda Motor Co Ltd (ADR) (NYSE:HMC) be willing to give these much-improved Fords a chance? Many weren’t, at first. But now it’s starting to look like word is getting out — and that bodes well for Ford’s sales, both here in the U.S. and elsewhere in the world.

The article Ford’s Escape Sets a New Record originally appeared on and is written by John Rosevear.

Fool contributor John Rosevear owns shares of Ford. Follow him on Twitter at @jrosevear. The Motley Fool recommends and owns shares of Ford.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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