Ford's Q1 sales report offers only a hint of what's to come, of course. With production halted and many U.S. dealers closed, it's nearly certain that U.S. auto sales in April will be only a fraction of April 2019's total.
We're in a different world right now. But for Ford investors, and auto investors generally, it's worth taking a look at the trends that were unfolding in the company's sales before the coronavirus broke out in the U.S.
Those trends can give us some idea of what to expect from Ford's first-quarter earnings report -- and, perhaps, what to expect when the pandemic subsides and the U.S. economy regains its footing.
The high and low points from Ford's first-quarter U.S. sales report
Again, the trends we saw in Q1 won't tell us much of anything about how the next few months will shape up for Ford. But they might tell us what to expect later on, when factories and dealers reopen after the COVID-19 crises abates.
With that in mind, for future reference, here are the high points of Ford's first-quarter sales report:
- The company's midsize Explorer crossover, all-new last year, got off to a slow start, as production snags limited deliveries for the first few months. But those snags appear to be history: Retail sales of the Explorer were up 10.5% in the first quarter from a year ago. While total sales (including fleet) were down 9% to 56,310, that was still enough to make it the bestseller in its segment, Ford said.
- Sales of Transit commercial vans, a key profit-maker for Ford, rose 15.7% in the first quarter from a year ago.
- Lincoln sales were up 6.1% from a year ago. Good results for the new Corsair and Aviator crossovers and the big Continental sedan helped.
- Sales of the Mustang were up 6.8% to 18,069, and the mix was good: Ford said that sales of the high-performance (and high-profit) GT350 and GT500 variants doubled from a year ago.
And the low points:
- Ford sold a lot of F-Series pickups, but not as many as in the first quarter of 2019: Sales fell 13% to 186,562. Ford said that part of the decline was due to the timing of some commercial-fleet deliveries; part, of course, was due to the coronavirus response.
- Sales of Ford-brand SUVs as a group were down 12.7% in the quarter. Sales of the compact Escape, all-new last fall, were down 20.7% to 48,117.
- Sales of the Fusion sedan fell 11.4% to 36,937.
One more point:
- Ford said that it had 100 days of inventory at dealers as of March 31. Under normal circumstances, that would be high -- but with factories closed and sales down, I think it's probably about right for now.
What does this tell us?
Here are a few things I see in Ford's numbers that might be relevant to us later on:
- Ford was still ramping up production and deliveries of the all-new Escape in the first quarter, and that almost certainly explains some of the year-over-year decline. Sales of the new Escape could turn out to be strong later in the year.
- The Mustang stole some market share from its old archrival, General Motors' (NYSE:GM) Chevrolet Camaro. Camaro sales were down 40.5% in the first quarter.
- Strong retail demand for the Explorer is an excellent sign after last year's early production and quality snags.
- Part of the decline here might have to do with lower fleet sales. Ford's now-abandoned plan to reopen several of its factories in April included the factories making its trucks, vans, and the Fusion sedan. The company hasn't said, but I suspect that it was hoping to produce enough vehicles to make some scheduled fleet deliveries by the end of this month.
What's next for Ford?
Ford will report its first-quarter earnings after the market closes on April 28. We'll learn a lot more about the state of the company, and its best guesses for the road ahead, at that time.