The iconic Mustang nameplate is on its swan song as Ford launched the seventh and final ICE generation of the revered muscle car in one of the biggest reveals of 2022. Ford describes the 2024 Mustang as edgy, sexy, and disruptive, and it might be just what Mustang buyers need. A redesign introduces a sharper, more muscular, and modern stance, and the storied muscle car gets future-ready with a horde of desperately needed upgrades. Sales begin in the summer of 2023, and the new Mustang faces an uphill task of rescuing the nameplate's popularity in the market.
Ford's annual sales reports indicate that the Blue Oval brand has struggled to sell the Mustang. Sales started declining in 2016, and the trend continued through the years, with 2022 posing as the pony car's worst sales year ever and losing the crown to the Dodge Challenger as the pony car segment's champion. Here's why Ford is struggling to sell the Mustang.
10 Poor Fuel Efficiency And Environmental Concerns
A study by McKinsey & Co found that many consumers in North America, Asia, and Europe want eco-friendly products. Cars have been one of the most significant sources of pollution and greenhouse gas emissions, and cars like the Mustang might lose a lot on a big chunk of the environmentally conscious market.
While the Mustang EcoBoost is relatively efficient for a Mustang, higher trims sacrifice economy for performance, and you are unlikely to see strong efficiency. The range-topping Shelby GT500 is one of the gas-powered cars with the worst fuel consumption.
9 Rising Gas Prices
With the rising gas prices, some consumers may be more hesitant to purchase a muscle car with lower fuel efficiency, especially if they want to save on fuel costs. This may particularly impact the sales of the higher-performance Mustang models, such as the GT and Shelby, which typically have lower fuel efficiency due to their larger engines.
But, it's worth noting that the impact of rising gas prices on Mustang sales may be relatively small, as Mustang buyers are typically more interested in the car's performance and style than its fuel efficiency.
8 Supply Chain Issues
The COVID-19 pandemic caused significant disruptions in the global supply chain, leading to shortages of raw materials, components, and parts. Even as the world gradually returned to normal, supply problems and logistical challenges in transportation and distribution persisted and still plagued the auto industry.
In November 2022, Ford reported a 10% drop in sales the previous month as they struggled with supply chain issues that delayed shipment to dealers.
7 Production Delays
The Ford Mustang has been a victim of the semiconductor shortage, and Ford had to temporarily halt production in Flat Rock, Michigan, for some time in 2022. Ford had to close its order books for the 2023 Mustang as they hit the brakes on production, thus losing on potential sales.
Furthermore, the upcoming 2024 Mustang has suffered delays. But these delays are a complex issue they can't fix overnight, and it will likely take time for companies like Ford to recover and return to pre-pandemic production levels fully.
6 Shifting Consumer Preference
The automotive industry has experienced a shift in consumer preferences. More people prefer SUVs, crossovers, and trucks over traditional sports cars like the Mustang – SUVs and crossover vehicles offer more space, versatility, and utility.
Changing demographics have influenced this change, as younger generations prioritize practicality and versatility over traditional luxury or performance features. Even Ford had to introduce the electrified Mustang Mach-E as an SUV to try and wrestle back some of the market shares.
5 Aging Target Market
The Ford Mustang debuted in the 1960s when the Baby Boom generation was coming of age and retained its youthful appeal for the next decades. But there is evidence to suggest that the target market for the popular pony car is aging. These are the performance and sports car enthusiasts who still hold nostalgic sentiments toward the old Mustang.
A report by Forbes indicates that the younger generations are less interested in traditional sports cars than boomers and are more likely to prioritize practicality, efficiency, and technology when purchasing vehicles.
4 A Slow Economy
Tough economic times have affected purchasing power, and many people who might desire a Mustang can't justify the high costs involved. The inevitable consequences of inflation outpace wage growth, potentially influencing the younger buyer in the market for new cars.
Furthermore, with more economical options like ride-sharing and car-sharing becoming more popular, some customers may not be as interested in owning a high-cost car like the Mustang.
3 Stiff Competition From Other Sports Cars
In recent years, the sports car market has become increasingly competitive, with new models from traditional competitors like Chevrolet, Dodge, and Porsche and new entrants like Tesla and Rimac. The Mustang was the best-selling pony car for a long time, beating off its hugely popular rivals, the Dodge Challenger and the Chevrolet Camaro.
But enduring the worst sales year ever wasn't the worst news for the Mustang, seeing it had to endure the second consecutive year behind the Dodge Challenger in the sales charts.
2 Availability Of Electric Vehicles
The upcoming 500 hp V8 Mustang Dark Horse Edition offers something worth waiting for, for enthusiasts who would ultimately love to see V8s survive in the long term. But the reality is bleak, and the world is gradually leaning towards electrified cars. Even rivals like Dodge are going all-electric with the Challenger and the Charger.
With more electric vehicles capable of high-performance outputs hitting the market, some customers may be turning away from traditional gas-powered cars like the Mustang.
1 Lack Of Significant Updates In Recent Years
Constant innovation is necessary in the automotive world, since consumers always seek the next fresh product. Ford has not made significant updates to the Mustang in recent years, which may have caused it to lose its appeal to consumers.
The Ford Mustang has continually evolved, and the outgoing sixth generation brought better engines and styling upgrades. But in 2023, the car is eight years old and desperate for a complete overhaul, which thankfully arrives with the new 2024 Mustang.
Sources: Forbes, Business Insider, Ford