Ford October sales fall, but new models and inventory gains boost results
Although Ford Motor Co. sales in the United States fell in October from levels a year ago, results released Wednesday indicate that the Dearborn automaker is making progress in resolving lingering issues in the chain. supply, although it is seeing higher-than-expected demand for some of the popular new vehicles in its lineup.
Ford sold 175,918 vehicles in its largest market last month, down 4% from October 2020. Truck sales are down 7%, but the automaker posted strong results in the first full month sales of its new Maverick compact pickup truck. And SUV sales rose 12.8%, with the Ford brand reaching their best retail sales month in 21 years, driven by demand for the new Bronco Sport, Bronco and Mustang Mach-E.
The results highlight a dynamic that presents both challenges and opportunities for the automaker: Customers are lining up to buy Ford’s new products, but a shortage of semiconductor chips and other constraints in the production chain. supply make it even more difficult to meet demand. Still, Ford – which has been hit harder than many of its competitors by the global chip shortage – said on Wednesday it was in a position to increase inventory levels in October. At the end of the month, the automaker had a gross inventory of 243,000 vehicles, up 7,000 from September.
“Continuous improvement in inventory and new products made Ford the best-selling automaker in America for the second consecutive month, which was last accomplished 23 years ago,” said Andrew Frick, Ford’s vice president of sales for the United States and Canada, in a statement. A declaration. “F Series, strong SUV sales driven by Bronco, Bronco Sport, Mustang Mach-E and Maverick’s first full month of sales really fueled our performance. “
Products in demand
October marked the Maverick’s first full month on the market. It recorded 4,140 sales, which Ford officials say exceeded expectations.
Among these first buyers was Tristan Guevara, 19, from Grosse Pointe. The truck – which starts at just under $ 20,000 before destination charges – is Indiana University’s first new vehicle purchase after sharing a Ford Escape with its sisters.
Over the summer, Guevara started looking for a vehicle he could use to make the five-plus hour trip from college to home, but found that there were plenty of options, new and used, were outside of its price range.
“It was really surprising how cheap it (the Maverick) was, comparatively,” he said. He ended up buying a Lariat AWD Maverick in charred gray and fitted with an Ecoboost engine. (The hybrid version of the truck is expected to start shipping to dealers in December, with deliveries starting in January.)
Two weeks later, “I love it,” Guevara said. He was impressed with the gas mileage, the handling of the truck, and the ease of navigation around campus, and looks forward to driving it to northern Michigan for outdoor pursuits such as jet skiing and fishing. . “I think it’s perfect for the student or anyone who wants a smaller truck.”
Guevara represents the type of customer Ford is targeting with Maverick: a young first-time buyer of new vehicles and trucks who was looking for affordable driving.
Maverick’s early sales results exceeded Ford’s internal targets, “but the biggest news is about the customer we’re seeing early on,” marketing director Trevor Scott told Detroit News.
For example: over 25% of Maverick buyers are between the ages of 18 and 35. Across the industry, people in this age group make up only about 12% of new vehicle buyers, according to Ford.
“Between fuel efficiency, cargo space, versatility, affordability,” said Scott, “I think the overall proposition is so appealing that it attracts many customers who hadn’t even considered a truck before. “
The age of the first Maverick buyers is important, he said, because it indicates that Ford is attracting new customers. Ford doesn’t see Maverick as a substitute, for example, for the F-150, but rather as an entry-level option that will attract new buyers to the brand. The compact truck also fills a void in Ford’s vehicle lineup for smaller, more affordable vehicles after the company stopped selling sedans in North America.
“It really is a no-compromise vehicle, and I think that’s why it has such broad appeal,” Scott said. “That’s why it allows us to replace what used to be that little sedan as an entry-level product in the showroom. Maverick now meets that need, but I think it has a broader appeal for a Much broader customer universe, and that’s exactly what we’re seeing play out here in the early days of launch and what we’re seeing in the market.
Carolyn Dorian, vice president and owner of Dorian Ford, said that while there aren’t many in stock, the Mavericks her dealership has gotten have sold out.
The Clinton Township dealership has sold more than 20 Mavericks so far, mostly through retail orders placed by customers before delivery. The dealership sees the pickup attracting buyers who have never considered a truck before, people who have never owned a new car, and a more diverse group than some of Ford’s other products. Dorian estimates that about half of Maverick buyers so far have been first-time new vehicle buyers who have traded in older used cars.
“They say Maverick is the perfect vehicle solution for them,” she said. They love the room inside, front and second row. They love the bed because they think it’s really functional and fits into their lifestyle. “
“It’s a cool truck that’s affordable,” she said. “Everyone says that. They’re like ‘Wow, it’s only $ 22,000.'”
Retail orders, sales of electric vehicles increase
Meanwhile, Ford said it recorded 77,000 retail orders last month, up 25,000 from September. Thirty-two percent of retail sales in October came from customer orders in advance, a system Ford executives said the company is trying to embrace for a larger chunk of sales. October marked the third consecutive month in which more than 30% of retail sales came from orders, up from 6% a year ago.
The automaker also announced record sales of its booming electrified line of vehicles. Sales of hybrid and battery-electric vehicles totaled 14,062, up 195% year-over-year. The automaker has announced that its upcoming E-Transit commercial van is sold out ahead of launch in the coming weeks and said it now has more than 160,000 reservations for the all-electric F-150 Lightning, which will launch in the coming weeks. next year.
The company said the Bronco SUV’s in-transit inventory was up 11.7% from September as the company fixes an issue with hardtop that has delayed some deliveries of the highly anticipated vehicle. Bronco made 7,364 sales in October. Sales of the smaller Bronco Sport totaled 9,201.
Sales of the Lincoln brand fell 17% in October. Mustang car sales fell 30.1%. Sales of EcoSport, Escape, Edge, Explorer and Expedition are all down for the month. And Ford’s flagship F-series saw sales decline 4.7% year-on-year.
Since the start of the year, Ford sales are down 6.6%.
Many automakers only release their sales results on a quarterly basis, but among those that release monthly reports, Ford is not alone in seeing a year-over-year decline. American Honda recorded a 23.5% drop in sales. Hyundai Motor America has seen sales drop about 1% year over year. Toyota Motor North America recorded a sales decline of almost 29%.
Still, the results exceeded expectations. Cox Automotive updated its October sales forecast on Wednesday, estimating a seasonally adjusted annual sales rate of 13 million, up from its initial forecast of 11.8 million. Overall, sales volume fell about 21% in October, better than the 30% drop predicted by Cox. The automotive news site attributed the better-than-expected results to stabilizing and even improving inventory for some brands.
“Ford delivered stronger results than expected,” Cox said in an update. “Toyota, Subaru and General Motors continue to struggle with low inventories and have recorded steep declines.”
Cox analysts expect demand to remain strong “for the foreseeable future,” but warned that production would remain limited until early next year.