Ford To Post July Sales Gain Thanks To Cash-For-Clunkers

August 3, 2009
Ford logo BEST

Ford logo BEST

The good news: Ford Motor Company is set to post a year-over-year sales increase for the month of July -- its first since 2007.

The (potentially) bad news: the jump in sales for July 2009 is due to the federal government's Cash-for-Clunkers program.

We say that's bad news because in scientific terms, Cash-for-Clunkers has caused a short-term, artificial adjustment of U.S. auto sales data. Without its effect, July sales would likely have been in keeping with the rest of 2009 -- which is to say, weak but on the mend. There's no sort of "control group" in this experiment, unless we consider supercar manufacturers like Lamborghini, whose models offer far less than the minimum mpg required by the program and whose U.S. sales for the first half of 2009 dipped 52%. (FYI, the Lamborghini Murciélago earns 8 mpg in the city.) But obviously, six-figure supercars are an awful gauge for mainstream sales. So for now, we've lost track of the rate at which sales are improving, and we won't get a clear picture of that data again until Cash-for-Clunkers ends (which could be sooner than any of us thought).

But that's the scientist in us speaking. For Ford, the jump in sales is great news. Ford hasn't seen a year-over-year increase since November 2007, and although it's managed to do slightly better during the economic downturn than its rivals -- losing about 34.1% in sales for 2009 as opposed to the 35.1% average experienced by other automakers -- it's still taken a significant hit. Ford will announce sales specifics later today.

When the dust settles on Cash-for-Clunkers, we hope Ford won't be the only one posting impressive numbers. (Subaru is already expecting a 30% gain over July 2008.) On the whole, Cash-for-Clunkers has really turned up the heat on the seasonally adjusted annual rate of sales. Initially, the industry was expecting to sell 10 million vehicles in 2009. Last week, we mentioned that Cash-for-Clunkers could directly and indirectly boost that figure to 10.7 million. Now, analysts at J.D. Power and Credit Suisse are projecting over 11 million and 12 million sales for 2009, respectively. Well played, federal government, well played.

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