Last year, when Ford
But as we know now, it didn't quite work out that way. Although Ford did manage to outsell GM in February of last year for its first one-month triumph since 1998, GM has since reasserted its position as the U.S. sales leader, comfortably outselling both Ford and fading challenger Toyota
But if projections from the industry-watchers at Edmunds bear out, we could be seeing the start of an intriguing horse race.
A fluke? Or a shift?
A few days ago, Edmunds predicted -- not without caveats, which we'll get to in a moment -- that Ford could outsell GM in the U.S. in March. Again, this wouldn't be unprecedented, and it wouldn't mark a change in the global pecking order. GM still outsells Ford by a huge margin around the world, and that isn't likely to change anytime soon.
But given that GM's U.S. sales have led the market by solid margins in recent months, it's worth taking a look at a few unfolding themes:
- GM's incentives down. The General's incentive spending, the money put into those "zero percent financing" or "cash back" offers, has been the highest in the industry, but it's coming down. Edmunds estimates GM's incentives, which were close to $4,000 per vehicle in February, will be down by $700 in March. A drop in sales is thus predictable, but that's not all bad: Average per-sale margins should be up. Even with lower sales totals, higher margins are a good thing.
- Ford has some aggressive discounts. Ford just launched its all-new Focus, and is working hard to sell down its inventories of the outgoing model. That effort is apparently going very well, according to Edmunds, as a willingness to discount combined with rising gas prices has led to a surge in demand for fuel-efficient cars.
- Hotter models in favored categories. While GM's Chevy Cruze compact is selling quite well, Ford's new Focus may outclass it. And Ford's midsize Fusion has won praise and sales, eclipsing Chevy's aging Malibu. Likewise, Ford's just-refreshed pickups are the hot ticket in that category at the moment, and the all-new Explorer is starting to steal some of the thunder from the Chevy Equinox and GM's other hit kid-haulers.
As I said, Edmunds' prediction comes with caveats: It's based on partial-month data, and much can change in the last week. We won't really know what's happening until the manufacturers release real numbers on Friday. But if this sales shakeup turns out to be a trend, rather than a blip, that last bullet point may be the most significant.
It's the product, stupid
Incentives go up and down, of course, but the larger story is (and has been) GM's lag in bringing new products to market. The company's financial decline and forced delays in several key product-development programs, and reports have suggested that more recent management shuffles have led to a number of rethinks and setbacks. Meanwhile, Ford has streamlined its global product portfolio and committed to an aggressive new-product cadence, with the Focus and Explorer just the latest in an ongoing series of critical (and so far, very successful) launches.
GM is getting its act together, though. The Cruze, introduced last fall, is probably GM's best-ever U.S.-market compact, and sales have been strong. An all-new Malibu, which GM describes as its first true "global" midsize sedan, will be unveiled in mid-April in both New York and Shanghai. And more new products are on the way, including two new Cadillac sedans and a major overhaul of the company's full-size truck lineup.
A recent Polk report suggests that GM is still doing a pretty good job of retaining its customers, with loyalty rates hovering around 60%, close to the industry lead. Will that be enough to preserve the General's sales lead while it rushes fresh product to market? We'll find out.