Ford, Lincoln and Mercury vehicle sales were down 26 percent during the month of August. Ford Sales Analyst, George Pipas says the sales challenge for all domestic and foreign car companies will continue through the rest of this year and beyond.
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| Cut #1: |
"Well it continues to be challenging as the weak economic conditions and consumer credit crunch continues - our expectations is, these conditions will persist through the rest of this year and well into 2009.":16 sec. |
However, there is a bright spot in all of this. Pipas is encouraged by the recent decline in gasoline prices at the pump, giving households across America a small break from record high fuel costs. |
| Cut #2: |
"This is important because the consumer can keep more dollars of their income and it relieves a source of pressure.":06 sec. |
| But keeping it real, Pipas did say financing for new vehicles and home financing will continue to be tight - lack of job growth, loss of jobs will continue to happen and that will extend this soft period into 2009. |
| Cut #3: |
"It's household income - and discretionary income in particular - that fuel the economy, so right now we're in a soft patch - we expect it to continue and the results that we see in August are very much in line with what we thought was going happen at the beginning of the year, so I would look for continuing declines in Ford and industry sales as we move through the rest of this year.":22 sec. |
| The bright spot during the month of August is shared between two vehicles that have been selling well throughout the year. Ford Focus sales were up 23 percent and Ford Escape sales were up 17 percent, versus a year ago. |
| Cut #4: |
"Both of these models - we provide better fuel economy than the previous generation, Focus has an mpg of 35 on the highway, matching Toyota's new Corolla and even better than the smaller Honda Fit... the Escape has got the best fuel economy of a small utility and its highway mpg is 28. The Escape Hybrid has a city mpg rating of 34.":26 sec. |
| Ford now plans to produce fewer vehicles in the second half of 2008 and as Pipas explained some of this is unique to Ford Motor Company, but is also a reflection of the economic climate. |
| Cut #5: |
"We're going to reduce sales to daily rental companies more than what we had planned. We are involved in a change over, a transfer of production of the Expedition Navigator from the Michigan Truck Plant to the Kentucky Truck Plant, we're losing some production associated with that transfer and we've revised our industry sales forecast to the low end of our previously forecasted range.":25 sec. |
| According to Pipas that forecast, including medium and heavy trucks total industry production count, should wind-up in the low 14 to 14.5 million range. |
| Cut #6: |
"So, in total our production adjustment is 20,000 units lower in the third quarter and 30,000 units lower in the fourth quarter.":08 sec. |
| The production cuts made last spring are paying off today because it puts Ford in a position to clear 2008 inventory by the time the company launches the 2009 F-150. |
| Cut #7: |
"That's a positive development, by getting those inventories down, it provides us the flexibility to make adjustments upward to our truck production at some point - when the housing market comes back, accompanied by the residential construction that goes with that - and we don't expect that to happen any time soon, but it certainly gives us the flexibility to respond if that's the case.":20 sec. |
| Ford now plans to produce 890,000 vehicles in the second half of 2008. |
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