Why Are Ford Explorers So Expensive? 10 REASONS WHY

Ford Explorers are expensive because of the brand's strong recognition and popularity which allows Ford to charge premium prices, especially amid high demand and low supply. Explorers also have rising production costs, more luxury features and safety tech, larger size requiring more materials, redesign investments to incorporate, and excellent projected resale value enabling higher pricing. Customers continue to pay the higher prices for these upgraded and low-supply SUVs, further enabling Ford to inflate costs.

The Ford Explorer has long been one of America’s most popular SUVs. But in recent years, the price tag on these vehicles has steadily crept up. Many car shoppers are shocked when they see the sticker price on the latest Ford Explorer models. What gives? Why are Ford Explorers so dang expensive nowadays? I did some digging to get answers.

It turns out there are a few key reasons why the Explorer costs more than your average set of wheels these days. From brand recognition and high demand to technology upgrades and tough emissions standards, automakers and dealers have been slapping higher price tags on Explorers. Below I’ll give you the inside scoop on the top 10 reasons the latest Explorers have steeper prices.

Top 10 Reasons Why Are Ford Explorers So Expensive

1. Strong Brand Recognition and Following

The Ford Explorer is one of the most familiar American SUV brands. It’s got a strong following of loyal owners. Buyers know and trust the Explorer name, which gives Ford lots of pricing power.

With so many customers willing to shell out big bucks for their favorite SUV, Ford can inflate Explorer price tags more than lesser-known brands’ prices.

2. High Consumer Demand and Diminished Supply

Between pandemic-related computer chip and parts shortages and other production constraints, carmakers like Ford can’t churn out as many Explorers as customers want.

High demand plus lower supply equals the freedom to charge more. People are willing to pay extra to get their hands on one of the hottest SUVs out right now. Limited availability allows dealers to tack on premium “market adjustment” fees too.

3. Packed With Luxury and Tech Upgrades

The latest Explorer models cater to buyers’ tastes for luxury and technology. Compared to past year versions, today’s Explorers offer way more upscale trim options and lavish bells and whistles.

From massaging seats to adaptive cruise control and vibrant touchscreens, Explorers now compete with premium SUVs on fanciness. All that pampering and tech costs money—which buyers must pay.

4. Engineering Investments for the Future

To meet ambitious fuel efficiency and electric vehicle production goals, auto manufacturers like Ford are pouring money into engineering and product development.

Sleeker design, innovative lightweight materials, and electrification plans for the Explorer lineup require huge upfront and ongoing investments. Ford prices each Explorer model to recoup some of those major engineering investments.

5. Rising Production Input and Parts Costs

Making vehicles has become more expensive across the board in recent years due to pricier raw materials, supply chain snags, and other cascading factors. Key inputs like steel, aluminum, lithium for batteries, and computer chips have rising costs.

Ford has to fork over more for Explorer parts and assembly now. And they pass some of that escalation to car buyers via MSRP hikes.

6. Bigger Overall Vehicle Size

Over the years, the Explorer has literally grown in physical size—becoming a larger, heavier, more material-intensive vehicle.

The latest generations require more steel, aluminum, glass, rubber, and other hard goods to construct compared to older Explorers. Bigger build materials expenses influence Ford’s pricing strategies.

7. Major Redesign Investment Amortization

Extensive redesigns and new generation launches like those for the 2020 and 2021 Explorers involve massive upfront engineering and manufacturing investments for automakers.

Ford spreads these costs across future production cycles so they can recover redesign expenses over time through sales. New generation sticker prices bake in some of those major redesign and retooling investments.

8. Strong Residual Values

Largely thanks to brand equity and popularity, the Explorer has excellent resale value projections. Strong residual value translates to less projected depreciation expenses for Ford to account for in pricing models.

This gives Ford leeway to price higher at the outset if they’ll potentially recover more value down the road—either on resold lease units or trade-ins accepting higher prices.

9. Higher Average Transaction Price Expectations

Industry analysts track new vehicle average transaction prices—what customers actually pay after incentives, fees, and options. The Ford Explorer has supported exceptionally high average transaction prices relative to other volume-selling SUVs.

Customers clearly will bear higher-than-average prices for these vehicles. So Ford feels justified nudging MSRP ever upward, as transaction trends indicate where the true market equilibrium lies.

10. More Standard Advanced Safety Features

The latest Explorer generations spotlight advanced driver assistance technology and safety capabilities that were entirely unavailable or expensive options earlier.

Systems like blind spot information, lane keeping alert and assist, automatic emergency braking, rear cross traffic alert, and adaptive cruise control now come standard on most new Explorer trim builds. Including all those built-in safety extras contributes to rising sticker prices.

FAQS.