Ford monthly sales drop 41%

April 1, 2:28 PMTampa Sports Car ExaminerMichael Berenis

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It's a sad day in the Ford marketing room today, knowing there has been an astonishing 41% drop in sales. Ford's future plans for sports cars is sure to suffer. Not being keen on federal money and it's support is what is taking the huge automaker to it's knees. The monthly sales statistics were 131,465 cars and trucks. Last year at this time, they sold 222,337 cars and trucks. Ford's car brands dropped 36.6% while the truck division lost an amazing 43.7% regarding monthly sales.

Is this the end for Ford? It doesn't look good. With out the backing of government funding, just like the rest of the American automotive industry it will fail too. There is a reason the government is buying out auto manufacturers. "I think I can say that we have been seeing some encouraging signs in recent weeks that the pace of economic decline could be moderating," Emily Kolinski Morris, Ford's senior economist.

Regardless of current situations, Ford stays consistent with refusing government aid. Retail sales have dropped 36% and rental / fleet service vehicle sales have declined 50%.  Ford's European division isn't doing well either as Volvo saw a 31.4% drop. This plague is all across the boards, not just Ford.

Ford's stock price, just like all other auto manufacturers is dropping just as quick as their sales records. Eight years ago, this company was worth almost $30.00 per share. Today's stock price at $2.68 is almost 93% less than what it was. Investors and share holders of this company and other auto manufacturer's are fit to be tied. If you invested $1,000 with Ford in 2001, you now have $89 or less in your account depending on trader fees. Some accounts get canceled after going under $100, so you might be stuck with a negative balance like most shade tree traders.

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To offset this loss, Ford is changing their inventories. Ford, Lincoln, and Mercury inventories have been lowered by 27% to accommodate for the loss of sales, but it wasn't enough. That leaves an minimal 20% left over in the dealerships parking lots. They only cut production by 26,000 vehicles between now and last year, it just isn't enough.

The money lost in production, storage, and retail value loss of "new vehicles sitting" is a cost that goes unseen. Ford will lose money on every vehicle sold if it sits at the factory for longer than usually expected. Being ahead of the curve, Ford did stop F-150 production in time being that these are the highest profit vehicles and stand to lose the most value by sitting. Consumers absorb the cost in the end by getting stale vehicles, instead of fresh from the factory.

Sports cars are the way of auto manufacturers giving back to the public. They aren't a required to produce sports cars, it's more of a luxury like how the government lets us have a license to use public roads. Will sports cars continue to be produced? We can only wait and find out. Chances are that they will eliminate sports car production in the near future to help cope with costs just as they have eliminated the F-150. Chevy is dropping out of NASCAR, so anything is possible.

More cut backs, lay offs, and job reductions is what the auto industry has lately been promoting. Bankruptcy is another term getting tossed around librally. The problem is that auto makers focused their profiteering on large trucks, suv's and gas guzzling sports cars. They didn't properly assess the 2000-2010 markets in the 90's when they built their business model. I guess no one saw $5.00 per gallon gas coming. Gas prices aren't the only problem, but they are a leading cause of why the auto industry is crumbling. Sit back and enjoy the ride.

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