Crain News Service report
DETROIT (March 4, 2014) — Ford Motor Co. is replacing its popular E-series delivery van lineup with the Transit line, a more fuel-efficient version based on a European design that will come in dozens of configurations encompassing two wheelbases, three body lengths and three roof heights.
The revamped Transit line-up — which includes the 2014 Transit Connect Van and Wagon rolling out now and the full-sized 2015 Transit commercial van — is based on a commercial van designed in Europe and adapted for use in North America.
Gone are the two V-8 engines and the 6.8-liter Triton V-10, replaced by two V-6s and a five-cylinder diesel.
The car maker has not yet released EPA fuel-economy figures for the Transit but said the various iterations of the Transit line will get 25- to 50-percent better mpg than the E series it's replacing. For comparison, a 2014 E-150 passenger van powered by a 4.6-liter V-8 is rated at 13 mpg city/16 highway/15 combined.
With the rollout of the Transit family, Ford is replacing a proven market leader with something radically different — but not totally new. Ford has sold more than 7 million Transits in 119 markets since introduction in 1979.
In the U.S., the E series has been shouldering the load for Ford's commercial and large passenger van business since Richard Nixon was president, dominating the market almost as much as the F series rules the pickup field.
In 2013 Ford sold 125,356 E-series vehicles — 102,705 cargo vans and 22,651 Club Wagons for passengers. Ford held a 48 percent share of the full-sized van market last year, a slight drop from 2012, when it had 49 percent. Ford has been the leader for nearly three decades.
"Many people have asked me, with E series being so successful, why are we making a change?" said Minyang Jiang, brand manager for the Transit, Transit Connect and E series.
There are a number of answers. Under the company's "One Ford" plan, Ford is consolidating its offerings around the globe onto a few common platforms. The Transit is a global vehicle and fits that plan, while the E series has been primarily a North American van.
"Taking a successful product strategy and leveraging it across multiple regions, instead of having to design unique offerings for different regions, that's a big advantage" for Ford, said Mike Jackson, director of North American forecasting for IHS Automotive.
With "all the different types of build configurations, that's a radical shift from the outgoing E series. That offers consumers a much broader range of choices. At the same time it would offer Ford meaningful opportunity for higher transaction prices and to deliver more value."
The Transit comes in an almost bewildering array of configurations: 58 in all. Ford will offer three roof heights, three body lengths, two wheelbases and three powertrains.
The E series hasn't changed much from the original Econoline of the 1970s. It comes in one wheelbase, excluding cutaway versions, and only one roof height.
"Transit offers a lot more payload and cargo capacity than we ever did with E series," Ms. Jiang said.
"With the small cargo van all the way up to the full-sized Transit, we're able to cover all kinds of businesses, from small businesses to large fleets. It [Transit] allows them to customize the fleet to the right size.
"Customers are telling us there's a lot of right-sizing," Mr. Jiang said. "It's not one size fits all. It's the ability to customize it to exactly what your business needs."
Jeff Carlson, president of Glenwood Springs Ford in Glenwood Springs, Colo., said: "The market was evolving away from the Econoline van. Businesses were looking either for a larger van or a smaller van."
What to order?
But that versatility has caused some head-scratching since Ford began taking dealer orders in January. For starters, dealers have never had the tall roof option before.
"It's going to be head and shoulders above what we were able to do with the vans before," said Ed Joliffe, owner of Gorno Ford in Woodhaven, Mich. "Our van was good for a long time, but it needed to change because businesses today are so much different. The hard part for us is to know what to stock."
Mr. Carlson added: "You can't have all the configurations in stock. When you stock configurations, you have to be sure you have the right vehicle. It will be a launch we'll have to pay careful attention to. Initially we're just going to have to see what the reception is. There are a lot of permutations there. We had the same issue when they extended the configurations on the Super Duty truck in 2007-2008."
Even though Ford is taking fleet orders, the company has not released prices. They should be announced in late spring or early summer, a spokesman said. Pricing will be crucial, since fleet customers are very cost-conscious.
"It's very complex. It's a lot of configurations," Ms. Jiang acknowledged. But she said Ford anticipated that and set up a system to help dealers narrow the choices.
"We've created a dealer-facing tool called transitbodydecoder.com" accessible only to dealers, she said. "If you're an inventory manager, by answering a few questions you can take the choices down from 58 to 12 to four to two. That's a tool we've created to minimize complexity."
Chris Ramos, president of Detroit Custom Coach, a suburban Detroit company that converts commercial vans into limousines, food trucks, mobile marketing vehicles and other units, said his company has big plans for the Transit.
"We've dubbed it the Sprinter killer," Mr. Ramos said, referring to the commercial van sold under the Mercedes-Benz and Freightliner brands. "In the limousine and chauffeured-vehicle world, the Sprinter is taking over where the chauffeured vehicle used to be. With Ford bringing out the Transit, they're going to give Sprinter a run for their money."
Mr. Ramos, whose company has been buying mostly Sprinters the last couple of years, said the Transit is an attractive option because Ford has a more extensive network of dealers to repair the vehicle. Ford has a network of more than 3,000 dealers including about 600 in its Business Preferred Network dealers.
IHS Automotive expects Ford to sell more Transits than it did E-series vehicles, though it doesn't expect the change to be dramatic. "We expect sales volume will peak near the 140,000 unit mark," Mr. Jackson said.
Perhaps nothing symbolizes the transformation from E series to Transit as much as the powertrain offerings.
"We're going from an exclusively gasoline engine lineup of two V-8s and a V-10 in the E series to offering customers a standard 3.7-liter V-6, the same 3.5-liter EcoBoost engine proven in Ford F-150 and an all-new 3.2-liter Power Stroke diesel option," said Len Deluca, director of Ford commercial vehicle operations in a statement.
Different roof heights also will broaden the Transit's appeal. Customers can still buy a Transit with about the same roof height as the E series, which was designed to fit into garages with a 7-foot clearance. But a 7-footer could stand nearly erect inside the high-roof Transit, which has 81.5 inches of cargo height.
The medium-roof version provides 72 inches of cargo height inside, and the low-roof version has 55.8 inches. Cargo volume ranges from 246 cubic feet in the regular- wheelbase, low-roof version to 487 cubic feet in the long-wheelbase, high-roof version.
By contrast the E series has a maximum interior height of just 51.9 inches.
Horsepower, torque and towing capacity for the Transit have not been announced. The E series offers maximum towing capacity of 10,000 pounds.
Ms. Jiang said Ford hopes the Transit will help Ford make inroads with more small-business customers. Ford sells about 80 percent of E-series vans to large fleets. That will change this year.
During the first year, Jiang predicts about 50 percent of Transits will be bought by those large fleet owners. The rest will go to smaller businesses.
"Small businesses are increasingly migrating to medium and high roofs. The medium and high roofs will help us capture a lot of customers looking for that space."
Cargo vans may not be as sexy as pickups, but the segment is still critical.
"The full-size van category is an important one because it has been historically tied to the performance of the economy," said Mr. Jackson of IHS Automotive.
He said the rear-wheel-drive Transit and the smaller front-wheel-drive Transit Connect will give Ford a one-two punch in the market. "They'll work closely in tandem," he said, adding fleet owners are increasingly conscious of cost of ownership these days, especially fuel economy.
This story is based on an article by reporter Bradford Wernle of Automotive News, a Detroit-based sister publication of Tire Business.