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Ford Motor Company
Driving Forward in June

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By JustMee01
July 2, 2009

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But the market overall is still depressed. Ford, Toyota and Nissan all called a bottom to the US market and are looking for improvement in Q3/4.

There still were some surprises though. Ford's resurgence to less than 15% year on year sales losses was led by the Fusion of course, with the Flex also posting strong numbers. But it wasn't the cars that made the difference. Trucks rebounded for the first time in a long time, down only 8%, while the Escape posted a 2% gain. No other major manufacturer posted less than a 20% drop (Nissan was closest), and most posted approximately 30% drops (notably both Toyota and Honda).

Performance was skewed, with Californians still sitting on their wallets (get out there and buy one, LOL). Regions still suffering a strong sting in home prices aren't performing as well. Ford saw its best sales in central US regions.

"Results were dismal in California, the single largest market, and the Western region in general where demand is not likely to recover until later in 2009, auto executives said.

Ford, which saw its market share jump to 18 percent in June from 14.6 percent a year ago, said markets in the middle of the country were much stronger than on either coast. That was a factor that played to Ford's strength in the central states.


Toyota noted the same regionality of sales strength, and also saw some improvement in light truck sales, although not as strong a rebound as Ford.

"Toyota's Mr. Carter said sales in California continued to be the "most challenged" in June, while other regions such as the Southeast, the East Coast and the upper Midwest had stronger sales. "We are starting to see some mild recovery on the light-truck side," he added. "It feels like the industry is coming back to a 50-50 balance at least in the short term.""

Ironically, with oil prices rising again, small cars as a group were the worst hit; down 40% year-on-year. Civic and Corolla sales were cut in half.

Ford also beat Toyota's US sales for the fourth straight month, positioning it to take the #2 share if trends continue. Year to date they're still down 30K units though.

Looking at retail sales alone, Ford's performance was better-- down 8%. GM also noted relatively worse fleet sales. Chrysler's fleet sales were down an abysmal 90%.

Ford also noted that the last week of June was actually relatively slow. They felt that some buyers were headed to the sidelines in anticipation of the clunker legislation.

Ford inventories were down to 60 days, and production raises are intended to maintain that 60 day inventory. Toyota carries a 40 day inventory, GM a 90 day inventory, so some of the built up inventory is turning. Chrysler is reportedly seeing a shortage of its popular models. All good things for reductions in incentives, which should help Ford as super-cheap deals become less common.

Overall, Ford's performance was good considering the problems the industry faces. The big caveats I see are overall consumer sentiment and that regionality of sales recovery. If Ford is the only manufacturer seeing current improvement, that's a little worrisome. It would be unfortunate to get dragged back to the pack if the overall market can't turn and consumer sentiment sours severely again. It seems that some of the worst news getting out, has people back kicking tires again. The other item that prompts notice is the regionality of sales. Ford's gain in market share from Toyota may result in large part from the poor performance of California, a market that Toyota leads by a healthy margin. Overall, Ford seems to be strengthening and remains on track for their recovery plan. Hopefully, they can keep the momentum rolling and extend their gains.