Jim Hackett, the new CEO, wants to dispose of slow-selling and low-margin Ford vehicle models and focus on the more lucrative trucks and SUVs in a bid to turn around the fortunes of the automaker.
By 2020, almost 90 percent of Ford's product lineup in North America will be trucks, SUVs and commercial vehicles. This is exactly what Fiat Chrysler Automobiles NV did to overtake Ford in profitability in the North American region.
Earlier this week, Ford revealed that it would be initiating the Sedanageddon protocol, killing off every single sedan in its lineup and leaving only the Mustang and a Ford Active hatchback/crossover as its only non-truck/SUV/crossover passenger vehicles.
Ford said it also is exploring what it called new "white space" vehicle silhouettes "that combine the best attributes of cars and utilities, such as higher ride height, space and versatility".
The company has said that the 2019 models of the Focus, Fiesta, Taurus and Fusion will be the last of its lineup. Ford has said it will offer 16 BEVs worldwide by 2022, with six available in the USA, although it hasn't yet said what those models will be.
The latest planned reductions will come from areas including engineering, materials costs, marketing and sales.More news: Maoists gunned down by the police in Chhattisgarh
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Additionally, Ford said it expects to put $5 billion less into capital expenditures from 2019 to 2022 than it once anticipated.
In a separate announcement, the U.S. automaker said it will add hybrid motors to its high-volume vehicles, such as the F-150 truck, Explorer and Escape SUVs, and the Mustang. The company is aiming to hit a pretax profit margin target of 8 percent by 2020.
The company plans to create long term value by making a full commitment to new propulsion choices, including the addition of hybrid-electric powertrains to high-volume, profitable vehicles such as the F-150, Mustang, Explorer, Escape and Bronco. Ford estimates that 90% of their portfolio will consist of such vehicles by 2020.
Ford previously predicted $14 billion in cuts by 2022.
The full-size Taurus, midsize Fusion, small Fiesta and wagon-like C-Max will no longer be sold in North America, Ford officials said. Ford went on to release its own truck in 1917.
"The passenger vehicle rationalization plan is just the sort of bold and decisive action we believe investors have been waiting for", Ryan Brinkman, an auto analyst at JPMorgan Chase & Co., wrote in a report Thursday, according to Bloomberg.