Ford’s Sales in December Plunge More Than 32%

Jan05

Ford’s Sales in December Plunge More Than 32%

AUTO INDUSTRY | By NICK BUNKLEY | |

The decline means Ford’s sales fell 20.7 percent, a difference of more than 500,000 vehicles, for all of 2008.

Other major automakers, including foreign and domestic brands, are expected to say that their sales fell at least 38 percent in December, according to projections by Edmunds.com. The most dismal reports will probably come from General Motors and Chrysler, which both received $4 billion in loans from the federal government at the end of December to help them remain solvent, as well as from Nissan.

Smaller carmakers fared only slightly better. Mercedes said its sales fell 23.5 percent last month and 11.2 percent for the full year.

Over all, analysts say 2008 will end up as the worst year for selling cars and trucks since 1992. But that comparison does not capture how quickly business deteriorated in recent months, as credit markets tightened and consumer confidence sank.

Plummeting demand for vehicles caused Toyota last month to project its first full-year operating loss in 70 years, showing that the industry’s woes extend far beyond Detroit.

George Pipas, Ford’s chief sales analyst, projected total industry sales for 2008 of about 13.5 million, a full 3 million fewer than in 2007. Not since 1974, when an oil embargo against the United States caused the price of oil to quadruple, has the market collapsed that much in a single year, he said.

Analysts said December’s sales rate would probably be worse than even the 26-year lows reached in October and November.

“When you adjust it for population, this is something that we really haven’t seen since the 1960s,” Erich Merkle, an automotive analyst in Grand Rapids, Mich., with the consulting firm, Crowe Horwath, said. “This is a really horrible cycle in terms of auto sales.”

There were some modest bright spots for Ford. The company estimated that its market share increased to 14.6 percent in December, up 0.7 of a point from a year ago. It marks the first time in 11 years that Ford’s market share rose, on a year-over-year basis, for three consecutive months.

In addition, the Ford F-series pickup appears to have maintained its position as the best-selling model in the United States for a 27th consecutive year, despite surging demand for small cars like the Honda Civic and Toyota Corolla. Ford began selling a redesigned version of the F-series this fall.

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