Tuesday, February 02, 2010

Headlines SCREAM Ford Reports 25% Sales Increase in Jan!

This is a factually true statement but is it representative of a resurgent American consumer and revitalized Detroit? Perhaps not.

It's in the Ford press release - however, it appears to have been edited out of many of the press releases that I saw published around the web - but Ford's retail sales in January actually FELL 5% in January. That's relative to a very weak market in January 2009, so to record further declines in 2010 is particularly troubling at the retail level.

So where did the growth come from? Fleet sales saw --- I'm not making this up --- a 154% INCREASE in January. Fleet sales are lower profit sales to commercial, government and rental customers. Ford did not provide a breakdown of what % of fleet sales were commercial vs. government vs. rental but I'd guess that government sales were a pretty good chunk of that number. Remember we didn't bailout Ford -- we just bought tons of cars from them :)

So on balance, it's better than having sales collapse as they did a year ago (when fleet sales were down 40%) but I think it's jumping to conclusions to assume that because the government replenished it's supply of Ford Escapes that we're back to happy times.

Ford is clearly winning the PR battle right now as the MSM talks about 25% sales growth and Toyota can't catch a break. To be continued....

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