The announcement comes at a time when car prices are reaching new heights, with the average price of a new car in the U.S. surpassing $50,000. As the company looks to expand its lineup with affordable options, this new move is seen as an effort to address the growing demand for more budget-friendly vehicles.
For years, Ford has focused primarily on trucks and SUVs, leaving a noticeable gap in its sedan offerings. The company had previously phased out compact and midsize sedans such as the Fiesta, Focus, Fusion, and Taurus, largely due to financial reasons. However, with the market now facing an affordability crisis, Ford is stepping in to fill this void. By offering a new car under $40,000, the automaker plans to offer something beyond its typical SUV or truck model, while also keeping up with the trend toward electrified powertrains.
A New Car for a New Era
Ford has not yet shared detailed information about the new car, but it has confirmed that it will be part of its strategy to bring more affordable options to market. The new vehicle is expected to be a compact or possibly midsize model, designed to offer an affordable alternative to the current lineup. The new car is crucial, as Ford’s current offering in the U.S. includes the Mustang, which remains the only non-truck or non-SUV model in the company’s portfolio.
The need for this new car is underscored by the increasing prices of new vehicles in the U.S. The average transaction price for a new car reached $50,326 by the end of 2025, and many models have seen their MSRPs rise above $50,000. According to a Cox Automotive study, these prices show no sign of dropping anytime soon, leading consumers to seek more affordable alternatives. The introduction of a sub-$40,000 car could help Ford tap into a market that is increasingly looking for budget-conscious options, reports Motor1.
Ford’s Larger Vision for Affordable Vehicles
The decision to introduce new, more affordable models is part of Ford’s broader strategy to expand its range of vehicles with diverse powertrains, including combustion engines, hybrids, and electric powertrains. According to Andrew Frick, president of Ford Blue and Model E, these new models will represent a “multi-energy” approach, offering various fuel options for consumers.
Among these new models, a midsize electric pickup truck is expected to be the flagship, with a 2027 launch date. These models will also feature fresh nameplates, meaning that Ford is not simply redesigning existing vehicles but is creating entirely new models.
This strategic push to introduce more diverse and affordable vehicles is crucial for Ford as it faces increasing competition in the U.S. auto market, especially from manufacturers focused on affordable EVs. By diversifying its portfolio with more affordable options, Ford hopes to balance both sustainability and customer demand for lower-priced cars.
The Revival of Ford’s Car Lineup
Ford’s announcement to reintroduce cars into its lineup is significant given the company’s recent history of cutting sedans from its offerings. The Fiesta, Focus, Fusion, and Taurus were all discontinued due to a lack of profitability.
The Mustang remained a holdout, offering something of a legacy of Ford’s car manufacturing. While the company has promised that its new car will offer electrified options, it remains unclear whether it will follow the trend of the hybrid and EV markets or be more aligned with traditional combustion-powered vehicles.
In addition to the U.S. market, Ford has also set its sights on Europe. The company has partnered with Renault to bring two new models to the European market in 2028, both of which will be built on Renault’s EV platform. While details on these models are still sparse, Ford’s expansion into more global markets suggests that the company is committed to car manufacturing, not only in the U.S. but also abroad.
