Luxury Option Demand Puts Squeeze on Ford Fiesta Suppliers

It appears the 2011 Ford Fiesta may be a victim of it's own success. Not long after a stop-shipment was issued for a single defective component, then poor weather delayed railroad deliveries, pushing pre-orders behind schedule, Automotive News has now reported that high demand for luxury options is putting serious strain on Fiesta parts suppliers.

Ford global marketing president Jim Farley told AN that options like leather seats and other upscale features are being ordered at a more frequent rate than the automaker had anticipated.

"It's been, frankly, a bit of a challenge because [suppliers] capacitized to supply specific content like heated seats at the rate that we told them, which is single digit," said Farley. "They're trying as hard as they can to catch up."

Farley also said that not having higher-level trim packages is reducing Ford's ability to capitalize on the Fiesta.

"I don't think it's substantial at this point because we think we're going to catch up," said Farley. "It's not a loss of revenue - it's: Can someone buy a $17,000 Fiesta versus a $17,200 Fiesta? Obviously, we'd make margin on the $200 difference, and that's the piece that we're missing."

Farley also dropped some interesting statistics on 2011 Fiesta sales. According to Farley, the average Fiesta buyer in the U.S. is 46 years old, but nearly 30 percent of U.S. sales go to the 16-35 year-old demographic. Lime Squeeze is the most popular shade so far and 1 million new Fiestas are expected to be sold globally by the end of October. The Fiesta launched in June in the U.S.

Source: Automotive News (Subscription required)

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