Ford to post first monthly sales increase in 2 years
CHICAGO -- Surging demand from the government's "cash for clunkers" program has helped lift Ford Motor Co. to its first monthly increase in two years, the company's top sales analyst said Sunday.
July sales results mark the first year-over-year gain for Ford since November 2007 and apparently the first uptick by any of the six biggest carmakers since last August, George Pipas said.
He declined to disclose a specific total before sales results are officially reported on Monday. Dearborn, Mich.-based Ford sold a total of 161,071 vehicles in July 2008, down 15% from a year earlier.
The increase further testifies to the successful reception of the government rebate program, which President Obama signed into law June 24 as part of a broad $106 billion spending bill.
"We were having a good month — and Ford's been having some good months lately — but the (clunkers) program really put us over the top for sure," Pipas said in a telephone interview.
The government's Car Allowance Rebate System (CARS) was designed to get old, polluting vehicles off the road and scrapped while helping car dealers emerge from the recession. Owners of gas-guzzlers could receive rebates of $3,500 or $4,500 toward the purchase of a new fuel-efficient car. The program proved wildly popular and led to the sale of 250,000 new vehicles in just days.
Transportation Secretary Ray LaHood said Sunday he expects the current $1 billion pool, which had been expected to last until November, to be exhausted by the end of this weekend. The House on Friday approved an additional $2 billion, shifting funds from a renewable energy loan program, and the Obama administration is pressing the Senate to go along before its summer vacation begins at week's end. If the Senate does not approve the additional funding, the progam will have to be suspended.
Improved sales at Ford and elsewhere may be another sign that the economy has either bottomed out or is nearing a bottom. The government reported Friday that the economy shrank at a pace of just 1% in the second quarter, better than analysts anticipated and much better than the 6.4% decline seen in the first three months of the year, which marked the steepest slide in nearly 30 years.
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