Vehicle

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Improving Vehicle Fuel Efficiency

To meet our climate change goals, we are focused in the near term on implementing the most cost-effective fuel-efficiency technologies across a large volume of our vehicles, as well as on introducing new products that offer improved fuel efficiency without compromising style or performance. We are concentrating on affordable and near-term sustainable technology solutions that can be used not for hundreds or thousands of cars, but for millions of cars, because that is how Ford can truly make a difference.

For example, we have introduced a wide variety of new engine and transmission technologies – as well as electrical system improvements, weight reductions and aerodynamic improvements – that deliver significant fuel-economy benefits for millions of drivers in the near term. By the end of 2012, we delivered 50 of the 62 planned new or significantly updated powertrains to help us improve fuel economy and reduce carbon dioxide emissions across our global fleet.

EcoBoost® engines, which use gasoline turbocharged direct-injection technology, are the centerpiece of our efforts to improve vehicle fuel efficiency. EcoBoost engines significantly improve fuel economy and reduce CO₂ emissions, and provide superior driving performance compared to larger-displacement engines. Because EcoBoost is affordable and can be applied to existing gasoline engines, we can implement it across our vehicle fleet, bringing fuel-efficiency benefits to a wide range of our customers. At year-end 2012, we had produced more than 520,000 EcoBoost engines. By the end of 2013, we will offer EcoBoost engines on 90 percent of our North American and European nameplates, and we continue to migrate them to our other regions. For more information on EcoBoost and our other near-, mid- and long-term fuel-economy improvement technologies, please see our Sustainable Technologies and Alternative Fuels Plan.

Results

We continue to improve the fuel economy of our new and refreshed vehicles in each of our markets worldwide. Global platforms, such as those on which our Ford Fiesta and Focus are built, allow us to roll out our advanced technologies at a lower cost, achieving the large volumes that provide a real benefit. For example, we recently launched our new 1.5L EcoBoost engine, which will be built in Romania and first introduced in the Ford Mondeo sold in China. As discussed above, EcoBoost significantly improves fuel efficiency and reduces emissions; by the end of this year, 80 percent of the Company’s global nameplates will be available with this fuel-saving technology. In 2013, the 3.2L Power Stroke® Diesel engine will be introduced in the U.S. in the fuel-efficient Transit full-size van. This engine, which will be manufactured in South Africa, adds to our lineup of advanced, clean diesel technologies used in vehicles marketed around the globe.

We are offering our customers the “power of choice” when it comes to fuel-efficient vehicles and fuel-saving technologies – i.e., the ability to choose what best suits their needs from a wide range of advanced technologies implemented across our product lineup. In addition to EcoBoost engines, for example, we now offer a wide range of fuel-efficient technologies on our conventionally fueled vehicles, including advanced transmissions and Automatic Start-Stop. We also offer six new electrified products in North America, natural gas- and propane-ready engines, and vehicles that can operate on higher blends of biofuels. In Europe we also offer advanced common rail diesel engines across our European model range, as well as an ECOnetic Technology range of low-CO₂ vehicles. We have committed that every all-new or redesigned vehicle we introduce will be best in class for fuel economy or among the leaders in its segment. For more information on our overall approach to fuel-efficient and alternative powertrain technologies, please see our Sustainable Technologies and Alternative Fuels Plan.

For the 2012 model year, our U.S. fleet CO₂ emissions decreased by about 7 percent relative to the 2011 model year and improved 15 percent compared to the 2007 model year. Preliminary data for the 2013 model year project that the Corporate Average Fuel Economy (CAFE) values will improve for both our car and truck fleets, compared to the 2012 model year. In Europe, preliminary data show that we have reduced the average CO₂ emissions of our car fleet by 15.5 percent between the 2007 and 2012 calendar years.¹

The following are some examples of our fuel-efficient vehicles by region.

North America

In North America, we continued to introduce new vehicles that use the technologies identified in our Sustainable Technologies and Alternative Fuels Plan, and that offer outstanding fuel economy and reduced CO₂ emissions. Among those with class-leading fuel economy, for example, are the 2013 Ford Fusion, Escape, and Taurus with the 2.0L engine, as well as the Lincoln MKZ. With the introduction of these new vehicles, we now have the most fuel-efficient vehicle lineup in our Company’s history.

For the 2013 model year, we offer eight vehicles that get 40 mpg (or MPGe) or better:

• Ford Fiesta SFE
• Ford Focus SFE
• Ford Focus Electric
• Ford Fusion Hybrid
• Ford Fusion Energi
• Ford C-MAX Hybrid
• Ford C-MAX Energi
• Lincoln MKZ Hybrid

In addition to the above, we are offering eight 2013 model year nameplates with 12 powertrain variations that get 30 mpg or better:

• Ford Fiesta 1.6L
• Ford Focus 2.0L
• Ford Fusion 1.6L
• Ford Fusion 2.0L
• Ford Fusion 2.5L
• Ford Taurus 2.0L
• Ford Edge 2.0L
• Ford Escape 1.6L
• Ford Escape 2.0L
• Ford Escape 2.5L
• Ford Mustang 3.7L
• Lincoln MKZ 2.0L

We also continued to expand the use of our EcoBoost engines, which significantly improve the fuel economy of gasoline engines. We will equip as much as 90 percent of our North American and European nameplates with EcoBoost engines by the end of 2013.

As illustrated in the graphics below, we have made significant progress in improving the fuel economy of, and hence reducing the CO₂ emissions from, our vehicles in North America. Figure 1 illustrates the improvement in fuel economy of key Ford vehicle models from 2003 to 2013. Figure 2 illustrates how the fuel economy of Ford vehicles compares to industry averages by vehicle segment for the 2013 model year. Ford’s 2013 model year U.S. vehicles rank better than the industry fuel-economy average in seven of 14 categories, the same in six, and worse in one.

Europe

Ford already offers one of the broadest low-CO₂ vehicle portfolios in Europe. In 2008, we began launching our ECOnetic Technology line of vehicles. These ultra-low-CO₂ versions of select Ford diesel vehicles leverage several advanced, fuel-saving technologies. The ECOnetic name was chosen because it links ecologically sensitive technology to our “energy in motion” design philosophy, which combines driving quality and emotional styling. The expansion of ECOnetic Technology to a wider range of models is part of Ford’s overall sustainability strategy, including the target of reducing CO₂ emissions of our cars by 30 percent between 2006 and 2020. In addition to these low-CO₂ models, in 2012 we also introduced the new 1.0L EcoBoost engine. This downsized engine – as well as other fuel-saving technologies such as Automatic Start-Stop, Smart Regenerative Charging, Active Grille Shutter, and EcoMode – are available on the Ford Fiesta, C-MAX, Grand C-MAX, Focus, Mondeo, S-MAX and Galaxy. Ford is the only non-premium manufacturer currently offering Active Grille Shutter.

In 2012, we extended the availability of best-in-class, or among-best-in-class, extremely low-CO₂ vehicles, which now include the following:

• The new Fiesta, launched in November 2012, delivers best-in-class fuel economy with a 1.0L EcoBoost engine that achieves 4.3L/100 km and 99 kg/km CO₂.
• In total, we now offer seven versions of the new Fiesta with CO₂ emissions below 100 g/km.
• The Fiesta ECOnetic, Ford’s most fuel-efficient and lowest-CO₂-emission passenger car ever, offers fuel economy of 3.3L/100 km² (86 mpg UK³/71 mpg U.S.) and CO₂ emissions of 87 g/km. The new model showcases technology innovations such as Automatic Start-Stop, Smart Regenerative Charging, EcoMode and shift indicator light. It also benefits from a bespoke engine calibration and optimized gear ratios. A lower suspension, undershield and wheel deflectors, as well as low-rolling-resistance tires, are used to further reduce driving resistances.
• The new Focus ECOnetic delivers fuel economy of 3.4L/100 km⁴ (83.1 mpg UK⁵/69 mpg U.S.) and CO₂ emissions of 88 g/km, making it the most fuel-efficient non-hybrid family car currently available in Europe. It is uniquely equipped with a lean NOx trap in combination with a coated diesel particulate filter.
• The Mondeo ECOnetic has a specially calibrated 115PS (85 kW) version of the 1.6L Duratorq TDCi engine equipped with a standard catalyzed diesel particulate filter. Due to a combination of changes compared to the standard Mondeo, the second-generation Mondeo ECOnetic is delivering a combined fuel consumption of just 4.3L/100 km⁶ (65.6 mpg UK⁷), which translates into average CO₂ emissions of 114 g/km – an important tax break point in some European markets.
• The Focus 1.0L EcoBoost model delivers best-in-class fuel economy and the lowest CO₂ emissions compared to its rivals. The 1.0L EcoBoost 100PS version delivers 4.8L/100 km⁸ (58.9 mpg UK⁹/49 mpg U.S.) and CO₂ emissions of 109 g/km. The 125PS model returns 5.0L/100 km¹⁰ (56.5 mpg UK¹¹/47 mpg U.S.) with CO₂ emissions of 114g/km.

In total, Ford offers 39 models and variants in Europe with CO₂ emissions below 130 g/km, of which nine models or variants have CO₂ emissions below 100 g/km.

After the successful introduction of the new EcoBoost gasoline engine family in the U.S., Ford launched 2.0L and 1.6L EcoBoost engines in Europe in 2010. These turbocharged, direct-injection gasoline engines will deliver up to 20 percent better fuel economy and fewer CO₂ emissions compared to conventional gasoline engines. In February 2012 the all-new 1.0L EcoBoost, first available in the Focus, joined the 1.6L EcoBoost gasoline and 1.6L TDCi ECOnetic in being leaders or among the very best in their segment in terms of fuel economy. The 1.0L EcoBoost is now available in the C-MAX, the all-new B-MAX and the new Fiesta. The engine uses turbocharging and direct fuel injection to extract impressive levels of power and fuel efficiency from its three-cylinder engine block, which is so small it can fit on a sheet of A4 paper. This combination of power and low CO₂ emissions is unmatched by competitors in its segment. The engine’s high torque of 170 Newton meters between 1,400 rpm and 4,500 rpm (or between 1,400 rpm and 4,000 rpm in the 100PS version) supports a fuel-efficient driving style and delivers a good performance feel and diesel-like torque experience. The 1.0L EcoBoost was named 2012 “International Engine of the Year” based on votes cast by 76 journalists from 35 countries around the world. This marks the first time Ford has won International Engine of the Year in the 13-year history of the awards. Moreover, the 1.0L EcoBoost received the highest score in the history of the awards. The engine also received “Best New Engine” and “Best Engine Under 1.0 Liter” awards from Engine Technology magazine.

Our global electric vehicle plan is extending to Europe with the Focus Electric, which will be launched in summer 2013, and other hybrid vehicles will be launched in coming years.

Ford of Europe’s innovative Product Sustainability Index (PSI) shows how the vision of sustainability can be made operational. By combining comprehensive sustainability criteria into the earliest stages of the product development process, Ford’s PSI provides a groundbreaking design-for sustainability tool. Designers can use it to assess the lifecycle CO₂ emissions of a vehicle, and consumers can use it to understand a vehicle’s footprint.

Asia Pacific and Africa

Ford will upgrade its entire powertrain portfolio in China with 20 advanced engines and transmissions to support its aggressive plan to introduce 15 new vehicles to China by mid-decade. These advanced, fuel-efficient technologies – including turbocharging, direct injection, twin independent variable camshaft timing (Ti-VCT) and six-speed transmissions – will deliver more than a 20 percent improvement in fuel economy to Ford’s passenger vehicle fleet in China by 2015, which represents a key part of Ford’s near-term sustainability goals in China. Ford’s joint venture, Changan Ford Automobile Co., Ltd. (CAF), is building a new engine plant and a new transmission plant to speed up the localization of advanced powertrains to meet China’s fast-growing demands. We are also continuing efforts to develop products that support the evolving “new energy vehicle” (defined as battery electric and plug-in hybrid electric vehicles) market in China.

We are introducing our fuel-efficient EcoBoost engines across Asia, and they are being well received by our customers. In China, 66 percent of Ford Mondeo vehicles sold in 2012 were equipped with the EcoBoost engine. In June 2012, Ford China launched the Edge with a 2.0L EcoBoost engine, and sales of the Edge with EcoBoost accounted for 99 percent of total Edge sales in China from June to December 2012. In March 2013, the award-winning 1.0L EcoBoost engine made its ASEAN¹² debut in the new Fiesta and EcoSport at the Bangkok International Motor Show. In early April, Ford announced that the first application of the 1.5L EcoBoost engine will be in the new Mondeo in China.

In India, we are also continuing to introduce vehicles with excellent fuel economy. The Fiesta – powered by 1.5L Ti-VCT gasoline and TDCi diesel powertrains developed for India – delivers class-leading fuel economy and reduced CO₂ emissions compared to the outgoing model. This builds on fuel economy leadership established with the Ford Figo, launched in March 2010, which has two engine options: a best-in-class, fuel-efficient 1.4L TDCi diesel and a very competitive 1.2L gasoline engine. These vehicles are highly significant to our success in India, as our studies show fuel economy to be the most important criteria in purchase consideration in that country. The EcoSport in India, which we plan to introduce mid-2013, will be powered by the 1.0L EcoBoost engine, making Ford the first manufacturer in the country to launch an SUV with a 1.0L gasoline engine.

In Australia, we launched an EcoBoost version of the Ford Mondeo in 2011 and an EcoBoost Ford Falcon in 2012. EcoBoost is also now available in the Focus ST and will be available in the all-new Kuga in mid-2013. Also in Australia, Ford’s next-generation EcoLPi liquid-injection liquefied petroleum gas (LPG) system for the Falcon became available in 2011, providing customers with the most advanced LPG technology on the market. The Falcon EcoLPi fuel system improves fuel economy by 12 to 15 percent, while also improving power by approximately 27 percent over the prior LPG Falcon model.

South America

In South America, we are improving fuel economy by introducing some of the efficient engine and transmission technologies currently used in North America, and by using technologies specifically relevant to the widespread use of biofuels in Brazil. In 2011, we introduced the Ford Mondeo with an EcoBoost engine in Argentina, which marked the debut of EcoBoost technology in South America. We are continuing to implement the new, more-efficient “Sigma” engine, which improves efficiency compared to current engines through reduced internal friction and improved electronic throttle controls. We have also improved the gearing ratios, aerodynamics and rolling resistance of our South American models, further increasing fuel economy. In 2012 in Brazil, we launched the new Ford EcoSport, a B-segment SUV, which is a fuel economy leader in its segment. In early 2013 in Brazil, we launched the new Ford Fiesta, which received an “A” rating for fuel efficiency in the new Brazilian fuel efficiency labeling system. Ford also received a “seal of excellence” award for the Ford Fusion Hybrid and 2014 model year Fiesta 1.6L TiVC in Brazil; these awards are given to vehicles in the top 20 percent for fuel economy, regardless of vehicle segment or type.

For the 2014 model year and beyond in South America, we are planning to introduce even more fuel-efficient twin independent variable cam timing engines and direct-injection engines, Battery Management Systems, smart alternator systems, dual-clutch automatic transmissions and improved aerodynamics in the B- and C-sized vehicle segments, which make up approximately 80 percent of the Brazilian market.