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 June 12, 2013
Ford will not update Focus Electric for 2014

 Ford Motor Co. will not make any upgrades to its Focus Electric compact car for the 2014 model year, yet another sign the automaker's lone all-electric vehicle is struggling to maintain relevance.

The Dearborn automaker will not have any base vehicle changes for the new model year, which debuts this summer. It's an unusual non-move for an automaker that often tinkers with vehicle packages and options on a yearly basis and will not help the vehicle gain much-needed traction in the marketplace, analysts say.

"My hunch is they do not want to put a lot of effort into the Focus EV," said Michelle Krebs, senior analyst at Edmunds.com, in a telephone interview. "It's almost like an obligatory vehicle they have to have for fuel economy and image. Ford's heart is not in this."

The Focus EV's lagging sales and unchanged attributes come at a time when competitors are retooling their EVs and as Ford plans to add production at its Saarlouis Assembly Plant in Germany for the European market, a move Ford will announce today.

Nancy Gioia, Ford's director of Global Electrification, said in an interview Tuesday that while the company is happy with sales of the Focus EV, it is a "niche" product, behind hybrids and plug-in hybrids.

"We still see battery electric as niche," Gioia said on the sidelines of an electric vehicle conference in Washington. "We think that by focusing on the plug-ins and that awareness, we actually end up benefiting both the hybrids and the plug-ins."

Through May, automakers have sold approximately 18,000 battery-electric vehicles and 6.39 million total vehicles.

Ford has three hybrids --- a Fusion, C-Max and Lincoln MKZ --- and two plug-in hybrids --- the Fusion Energi and C-Max Energi plug-in hybrids.

Gioia said EVs still have issues including range limitations, battery life and charging infrastructure.

"The batteries are still very expensive," she said. "The pay back period is still tough ... BEVs are a hoot to drive. That is not the issue. The economic viability of it is."

Edmunds.com, which tracks vehicles that customers would consider buying, said in November 2012, just 0.55 percent of website visitors said they would consider a Focus EV.

That number dropped to 0.19 percent in May, the same percentage of potential buyers as Nissan Motor Co.'s all-electric Leaf.

But sales of Nissan's EV reached 2,138 in May, according to Autodata Corp.; by comparison, Ford has sold 1,416 Focus EVs since its December 2011 introduction, with most of those coming after May 2012, when retail sales officially began.

Most Focus EV sales have been concentrated in California --- an electric-vehicle haven --- and a majority have been sold to retail, and not fleet, customers.

Ford does not believe building more Focus EVs, which are produced on a flexible assembly line in Wayne alongside the gas-powered Focus, C-Max Hybrid and C-Max Energi plug-in hybrid, will help boost more customer demand.

Nissan's sales gains can be attributed almost exclusively to the fact the Japanese automaker dropped the base price on the car by 18 percent to $28,800 for the 2013 model year; the car is eligible for a $7,500 federal tax credit.

Nissan also added extra cargo room, and for higher-end trims, a new on-board charger that cuts electric charging times in half. The Focus EV costs $39,200, before the same tax credit.

While Ford has offered some modest discounts on the Focus EV, it won't match hefty price cuts by competitors.

"We're not going to chase down to the lowest price possible --- that doesn't make sense to erode the brand image or the true value of the product," Gioia said.

"We're going to continue to evolve that product --- make it better and better ... We don't see the need to push it like crazy and erode the image of it."

Hundreds of millions have been spent by Ford and the federal and state governments to help boost the Dearborn automaker's electric vehicle lineup.

Ford spent $550 million to retool its Michigan Assembly Plant for Focus Electric, C-Max Hybrid and C-Max Energi production.

It spent another $450 million starting in 2010 --- and received tax credits totaling $188 million from the Michigan Economic Growth Authority --- for engineering and production of electric vehicles.

In 2009, Ford received a $62.7 million Department of Energy grant to help produce an electric-drive transaxle.

LG Chem Inc. --- the South Korean company that supplies batteries for the Focus Electric and Chevrolet Volt --- also received a $151 million DOE grant.

Another Ford electrified vehicle --- the Transit Connect EV, sold for about 15 months from 2010 to 2012 --- failed after its electric powertrain upfitter, Azure Dynamics, went bankrupt last year. Only about 500 were sold.