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Automotive Industry
AUTO: Ford Sales Improve During June
Slight monthly improvements in vehicle sales raise hopes for remainder of 2009.
Bob Golfen  |  Posted July 01, 2009   Phoenix, AZ
Escape Hybrid was a solid seller for Ford during June. (Photo: Bob Golfen)
Ford Motor Co. showed some resilience during June, with sales for the month sliding considerably less than expected, according to monthly sales reports released Wednesday.

Ford sales were down 10.7 percent compared with June 2008, but that’s better than analysts’ earlier projections of a 15-20 percent decline, and the best total in 16 months.

The results buoyed hopes that auto sales could be turning the corner, and supported Ford’s recently announced plans to boost its car and truck output by about 35,000 during the second half of the year.

“Ford’s performance surprised us,” said Jesse Toprak, senior analyst for Edmunds.com. “It was significantly better than we anticipated.”

The new Nissan Cube was one of the high points for the Japanese automaker. (Photo: Nissan)
Fusion, Escape, F-series pickup and hybrid sales helped boost Ford’s results, which include the Ford, Mercury and Lincoln brands as well as Volvo, which also saw improvement. Fords supply of unsold vehicles stands at 60 days, Toprak said, “which is ideal.”

Bankrupt General Motors saw a sales decline of 33.4 percent, compared with last June, while Chrysler slid nearly 42 percent, raising concerns about the viability of the new Chrysler-Fiat alliance.

“Chrysler sales were the worst June on record,” Toprak said, adding that it was the poorest monthly result since January. Chrysler’s incentives were also the highest of the major automakers, at an average of $4,873 per unit.

The Japanese automakers saw steep declines during June, with Toyota down 31.9 percent, Honda off by 29.5 percent and Nissan down 23.1 percent. Nissan’s funky new Cube has seen a favorable response, but sales of Altima and Murano are off.

Once again, Subaru saw a sales increase compared with June 2008, at a 3.4 percent gain.

Among the Europeans, BMW sales were down 20.3 percent, Daimler (maker of Mercedes-Benz) slackened 26.4 percent and Porsche was off a whopping 66 percent. Figures were not yet available for Volkswagen-Audi or Jaguar.

All of the monthly sales results were tempered by last year’s market, which was stricken by soaring fuel prices starting in May 2008. Sales of trucks and other thirsty vehicles plunged in favor of small cars and hybrids.

So this June’s sales of larger vehicles showed comparatively less decline, compared with last June’s down market, while more thrifty vehicles seemed to plunge more.

While last month’s sales showed a moderating of decline in some areas, they aparently failed to reach annualized sales of 10 million, a strong psychological barrier, in preliminary figures.

Instead, the sales-per-year figure reached about 9.8 million, Toprak said, adding that June sales started out strong but slackened toward the end of the month.

Part of that drop off may have been caused by the recently approved Cash for Clunkers law, he said, which provides up to $4,500 for people who trade in gas guzzlers for more efficient vehicles.

“Anticipation of Cash for Clunkers could have depressed sales for the end of the month,” Toprak said, adding that auto sales likely will languish for the near future.

“It’s going to take four or five years to get back into that 14-14.5 million range,” he said.
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