Automaker will switch plant work from trucks to Fiesta subcompact.
Ford Motor Co. announced a series of new investments in Mexico Friday worth $3 billion — the largest automotive investment ever in the country.
The Dearborn automaker confirmed plans to build the North American version of its new Ford Fiesta subcompact at its Cuautitlan Assembly Plant.
Ford also will add a new diesel line at its Chihuahua Engine Plant and is planning to build a new joint-venture transmission factory with German supplier Getrag in Guanajuato.
“It provides a cost advantage making it in Mexico,” said Erich Merkle, a product analyst at IRN Inc. in Grand Rapids.
CEO Alan Mulally was on hand for the announcement, along with Mexican President Felipe Calderón Hinojosa.
“Ford is absolutely committed to leveraging our global assets to accelerate the shift to more fuel-efficient small cars and powertrain technologies that people really want and value,” Mulally said. “Our investments in these facilities in Mexico are part of our plan to further realign our manufacturing capacity in line with the introduction of more small cars and crossovers.”
The moves are expected to create about 4,500 new Ford jobs south of the border, as well as 30,000 direct and indirect support jobs.
The Detroit News and other media had already reported that the Fiesta would be built in Mexico, but Ford had not previously confirmed those reports. On Friday, the company also said it plans to sell the sporty European hatchback model of the new subcompact in the United States, too.
The Fiesta is the production version of the Verve concept that made its U.S. debut in Detroit in January.
“Customers responded very positively after seeing both the sedan and hatchback versions of the Verve small car concept,” said Mark Fields, president of Ford’s Americas Group.
“We know the market is headed toward more small cars and crossovers.”
The car will go into production in Mexico in 2010, and will go on sale in the United States later that year. It goes on sale in Europe this year and will debut in Asia next year.
“We’re looking at every aspect of what’s defined Ford as a small-car leader in Europe and working to build on this expertise in driving dynamics and design across a global family of Ford cars that are as exciting to drive as they are to look at,” said Derrick Kuzak, Ford’s global product development chief.
“The Fiesta is designed to set a new world standard for quality, design, fuel economy and comfort in the small car segment.”
The Cuautitlan Assembly Plant currently makes trucks for the Mexican market, ranging from the Ford F-150 to the F-550. To meet future demand, trucks for Mexico will be imported from the U.S.
Read more about : Ford to close deal with Tata
Sometimes automakers really do listen to consumers. In the case of Ford, particularly with its crowd pleasing F-150 pick-up truck, Ford not only is listening, but delivering. What am I talking about? A hot-rod pick-up truck, that’s what. That’s right, Ford is going ahead with plans to market a truly “boss” version of its perennially best selling truck, the F-150, to give many fans just what they have wanted. Read on for a sneak preview of Ford’s soon to be released FX2, a dream-come-true for avid Ford lovers.
With gas prices approaching record levels, some are questioning Ford’s decision to release yet another version of its highly popular full sized pick-up truck, the F-150. Yet, demand for big trucks and SUVs continues to remain strong suggesting that size really does matter for many consumers. True, a smaller truck can be adequate for some motorists however most contractors require the large carrying capacity of the F-150 thus the continued high demand of these types of trucks. Plus, serious pick-up truck drivers will tell you that there is nothing that matches the abundant capacity of an eight foot bed in carrying everything from lumber to yard debris to sport gear and more.
As it is with many truck owners, function is one thing while styling is but another. Base versions of the F-150 are attractive and capable enough, but sport concepts have continued to create so much buzz that Ford is responding to consumer demand by building the FX2. Specifically, the new model is in response to the overwhelmingly positive buzz a concept version has been receiving at auto shows everywhere.
So, what separates the FX2 from the average F-150? Plenty, including the following features as shared by Ford in a recent press release announcing the new model:
– a dark billet grille
– a sporty, deep front valance
– clear headlights paired with platinum bezels
– monochromatic paint scheme that blends in the bumper, side mirrors, and door handles with the rest of the truck
– chrome exhaust tip
– 18 inch wheels
– black captain chairs with red stitching, available in clothe or in leather
– flow-through center console with floor shifter
Engine choices haven’t been announced, but Ford has said that its popular 5.4L V8 will be offered. The FX2, a two wheel drive vehicle, will complement an existing off road model, the FX4. Ford builds more versions of its full sized pick up truck than any other manufacturer in the world.
Yes, the FX2 is another part of Ford’s “Bold Moves” promotional campaign. While the new model is based on an existing truck, it does something that Ford is finally learning to do right: listen to its consumers. With the 2007 F-150 FX2, it appears that Ford has responded with certainty.
Tags: Ford Trucks, pick-up truck
With the introduction of the 2007 ROUSH Nitemare F-150 there are destined to be plenty of other pickup drivers having nightmares about this limited-to-100 edition hauler after watching it blow by them on roads across America.
The 2007 ROUSH Nitemare is a menacing tone-on-tone, 445-horsepower beast. Based on the standard cab version of the F-150, the power-to-weight ratio will ensure that this monster has plenty of haul.
Under the hood is the famous ROUSHcharger which boosts the 5.4L, 3 valve engine to 445-horsepower and 500 lb-ft. of torque. Additional “go fast” components include intake manifolds, intercooler, radiator, and air induction system. This unit, like all the ROUSH components from a company so highly recognized for producing power, quality and performance, is covered by ROUSH’s industry exclusive 3 year/36,000 mile warranty.
The ROUSH Nitemare will be offered exclusively in black for the 2007 model which is limited to just 100 units, each striped with a matte black design to further accent the ominous look. A ROUSH front chin spoiler and black aluminum billet grille complete the exterior styling, but the addition of the ROUSH dual rear exit exhaust system gives this truck the growl expected from such a beast.
To further the performance of the ROUSH Nitemare, the Livonia, Mich.-based technicians install a Ford limited slip 3.73 rear axle and have increased the electronically-controlled speed limiter to 105 mph.
Ford Motor Co. will soon be offering computers in its pickups and vans. Plans are in the works to have an in-dash computer with high speed Internet and a ink jet printer on its F-150 trucks and commercial vans.
The Ford’s Work Solutions package will also include a radio-controlled tool tracking device, a computerized management system to help workers keep an eye on vehicle fleets and a lockable storage system for pickup beds. The package will be unveiled at this week’s Chicago Auto Show.
While pricing has not been released each of the features will be available together or separately. Ford commands 40 percent of the commercial vehicle market in the United States. By offering these features it hopes to increase that percentage.
The system will use Microsoft Windows CE and Windows Auto. The Internet connection will be with Sprint cellular broadband and will be Bluetooth enabled. The Tool Link component will allow for owners to mark and scan their tools using a radio tag. When a vehicle is powered up it will automatically scan inside the truck for an inventory which can be displayed on the in-dash computer.
2009 Ford F-150
For truck guys Matt O’Leary and Pat Schiavone, P415 was just another assignment. To their bosses in Dearborn, though, P415-the internal codename for the 2009 Ford F-150-was almost certainly Ford Motor Company’s single most important new-model design and development program this decade. Last year, one in three vehicles carrying the Blue Oval badge sold in America was an F-Series. On a world scale, the F-Series accounts for 13 percent of global Ford Motor Company sales.
Chief engineer O’Leary and chief designer Schiavone seem remarkably relaxed about it all, however, as they walk us through the detail of the new F-150. That’s because they’re old hands at this game: They and their teams worked together on the F-150 that launched in 2004. O’Leary’s spent 30 years at Ford, most of it working on truck programs. Schiavone grew up around trucks-his father was in the construction business-and has helped design three generations of F-150.
The Backbone
Both men also understand that full-size-pickup buyers are among the most conservative consumer groups in the auto biz. Which is why the 2009 F-150 is a carefully considered study in evolution, not revolution. It starts with the fully boxed frame, which is 25 pounds lighter and 10 percent stiffer, thanks to hydroformed high-strength-steel side rails. The double wishbone short- and long-arm front suspension with coil-over shocks shares components with the 2008 Expedition. The 36mm front stabilizer is hollow and eight pounds lighter than the previous component. At the rear are six-inch-longer leaf springs, the extra length forward of the axle centerline to provide better lateral compliance and reduced rear-axle steer.So far, so truck. But O’Leary’s engineering team has delved into Ford’s electronic goody bag to give the new F-150 a level of refinement, security, and user-friendliness unheard of in a pickup truck a few years ago. Ford’s traction- and stability-control systems are now standard on all F-150 models, from the base work truck up. In addition, Ford’s software geeks have figured out a way of using these systems to detect trailer sway: By tracking the yaw motions of the truck, the system can sense whether a trailer is swinging and then use a combination of braking and engine torque control to bring it back under control. If the F-150 is fitted with Ford’s optional Trailer Brake Controller, the system also will use the trailer brakes to bring things back under control. Additionally, the new six-speed automatic transmission includes a towing mode that not only holds a lower gear for hauling up hills, but cleverly works to hold the rig to a constant speed on a downhill stretch.
Brute Strength
Pickup-truck buyers brag about two things: towing performance and payload capacity. O’Leary claims the new F-150 has class-leading towing capacity across all cab configurations and the industry’s highest payload capacity. But the fact the new F-150 will be available only with V-8 engines under the hood makes a strong statement on paper. Base powerplant, even for the pool guy’s regular cab XL, is the 4.6-liter two-valve V-8, which makes 248 horses at 4750 rpm and 294 pound-feet of torque at 4000 rpm. O’Leary claims the engine, though still hooked to a four-speed automatic, delivers the same fuel economy as the 4.2-liter V-6 that serves as the base engine in the current F-150.An all-new 4.6-liter three-valve engine, based on the Mustang small-block, will be the new F-150’s volume-selling powerplant. This engine makes 290 horses at 4750 rpm and 317 pound-feet of torque at 4000 rpm and drives through the new six-speed automatic. O’Leary says despite the extra power, the new engine returns better fuel economy (about one mpg on the highway, and two mpg in the city) than the base version.The top-range engine (at least until the hush-hush 6.2-liter Hurricane V-8 makes its debut in the next-generation Harley-Davidson edition) is the familiar 5.4-liter Triton V-8. Power is up 10 horses to 310 at 5500 rpm, and torque has been boosted to 365 pound-feet at 3750. The revamped Triton is E85 capable. Look for a diesel in the F-150 in 2010.
Design Cues
Like the mechanicals, the new F-150’s design is evolutionary as well, picking up cues from its bigger Super Duty brothers. The dip in the side window-first seen on the HN80 Louisville heavy truck before migrating down through the Super Dutys-is the most obvious piece of Ford truck DNA on the new F-150.While it might look familiar, parked next to the current model, the changes are obvious, most notably at the front, where the nose has been raised four inches and the grille reworked to echo the “girder” themes of the Super Dutys. Along the body side, big undercuts emphasize the wheel openings, and at the rear is a tailgate with stamped moldings that echo the classic stainless-steel cladding of old F-150s. The taillamps feature a lens within a lens.The windshield is a carryover item from the current F-150, but the roofline has been raised 1.5 inches to meet tougher rollover standards and to package the optional side-curtain airbags without intruding on headroom. As before there are three basic cab configurations: regular cab, SuperCab, and SuperCrew, the last with a whopping six-inch stretch over the current model that gives it class-leading interior room. The most notable thing when you slide in behind the wheel of a crew cab is that the B-pillar is no longer forward of your shoulder. The front-door aperture is much longer (instead of the door from the regular cab, the SuperCrew uses the front door from the SuperCab) yet there’s an acre of room for back-seat passengers.
Big Improvements
With crew cabs now comprising 60 percent of the pickup-truck market, it’s not surprising Ford has spent a lot of time and money on the SuperCrew. To improve cargo-carrying capacity, the floor behind the front seats is completely flat (which meant big engineering changes to sills and moving crossmembers on the frame, among other things). The rear-seat cushion cantilevers out from the rear of the cab and has gas struts that allow you to fold it up against the backrest with one hand (or with the nudge of your knee, if your hands are full). Unlike the current F-150, there is no jack or premium sound-system subwoofer in the way, either. Schiavone claims the SuperCrew has more useable space inside than its Dodge or Toyota rivals.”We took the same logic with the interior as we did with the exterior-toughen it up,” says Schiavone. “We think we now have the right mix of ‘truckiness’ and elegance.” The new dash features strong architectural elements, a modern integrated audio system, and new gauges. There are new seats-more sculpted and more comfortable-and new center consoles.
Dressed to Impress
When the new F-150 hits Ford dealer showrooms, buyers will be able to choose from no fewer than seven distinct trim levels (see sidebar). One of the new additions to the lineup is the truck you see on these pages, the Platinum, an ultralux F-150 positioned above the King Ranch. “King Ranch has kind of a southwest feel,” says Schiavone. “This is more Chicago.” The Platinum gets a unique grille, unique 20-inch polished alloy wheels, and two unique interior environments-the stone and brown you see here, and a stunning black with dark brown seats that almost makes a Lincoln Navigator look dowdy-plus dark wood and real brushed stainless-steel trim on the dash.The success of the upscale F-150 King Ranch, which started out as a 1500-unit-a-year feature vehicle and is now a highly profitable 30,000-unit-a-year series all its own, proves the point. Cowboys like fancy clothes. But that doesn’t mean they’ve forgotten how to shoot.
XL
Base engine: 248-hp, 4.6L 2v V-8. Four-speed automatic. Black bumpers, mirrors, and door handles. No foglamps. Dark interior environment with gray seats. Hose-out rubber floormats. 17-in steel or alloy wheels.
STX
Base engine: 248-hp, 4.6L 2v V-8. Four-speed automatic. Body-color bumpers, grille surround, foglamps. Same dark interior environment as work truck. 17-in alloy wheels standard; 18s optional.
XLT
Base engine: 248-hp, 4.6L 2v V-8. Four-speed automatic. Chrome grille, bumpers. Black with gray (cool) or chocolate brown with tan (warm) interiors. Silver paint on dash, dark finish on center stack, upgraded instrument cluster. 17-, 18-, or 20-in wheels. SuperCab and SuperCrew feature 4.6L 3v V-8, six-speed automatic.
FX4
Base engine: 310-hp, 5.4L 3v V-8. Six-speed automatic. Body color bumpers, door handles, and on mirrors. Black interior, optional light gray seats. Full-length center stack and center console with carbon fiber look trim. Silver gauges. 17-in wheels for off-roaders. 18s and 20s available.
Lariat
Base engine: 310-hp, 5.4L 3v V-8. Six-speed automatic. Two-tone with Pueblo gold lower. Chrome grille with mesh instead of bars. Body-color “skull caps” on mirrors. 18- and 20-in wheels offered. Wood on center stack, console, and doors.
King Ranch
Base engine: 310-hp, 5.4L 3v V-8. Six-speed automatic. Basically a Lariat with King Ranch leather on seats, console and steering wheel, different wood trim, and pale carpets. 18- or 20-in alloy wheels with premium paint trim.
Platinum
Base engine: 310-hp, 5.4-liter 3v V-8. Six-speed automatic. Body-color bumpers with thin chrome trim. Chrome on mirrors. Unique interior environments with brushed stainless-steel accents. Wood on steering wheel. Unique polished 20-in alloy wheels.
Tags: 2009, F-150, Ford F-150, Ford Trucks
Ford’s truck team have redesigned America’s favorite truck inside and out to give customers unrivaled capability, unprecedented choice and a host of smart, game-changing features.
The result is the new 2009 Ford F-150, the new benchmark in the full-size pickup segment from the industry’s truck leader – which has built more than 33 million F-Series pickups since 1948.
The Ford truck team revamping goes from its segment-first features to the tough new exterior highlighted by a dramatic three-bar grille and more spacious, flexible and refined interior, to the unparalleled choice of cab styles and trim levels – including a new Platinum series that redefines truck luxury
- A new high-strength, lighter-weight chassis is the backbone that allows this tough truck to deliver more horsepower, better fuel economy and safety, and additional towing and payload capacity
- In all, more than 1,000 Ford engineers, designers, researchers and others worked together to develop the new 2009 F-150. The team drew inspiration by listening to Ford’s large customer base
- The results will be clear to customers when the new 2009 F-150 rolls off assembly lines at Ford’s Dearborn (Mich.) Truck Plant and Kansas City Assembly Plant in Claycomo, Mo. – and as the new F-150 goes on sale in dealer showrooms this fall.
Most Choice
- Ford’s truck team designed a truck that offers more choice than any full-size truck on the market. With three cab styles, four box options and seven unique trim levels, the F-150 comes in 35 different configurations to meet the widest range of customer needs and wants – all delivered with quality.
- Customers can choose from the no-fuss XL workhorse, to the sporty STX and off-road capable FX4, to the mid-range XLT. For those looking for tough luxury, Ford offers the high-end Lariat and King Ranch F-150 models.
- New for the 2009 F-150 is the Platinum series, the most luxurious F-150 ever and the answer to a perennial question: Just how high-end do truck customers want to go?
- The striking F-150 Platinum features a satin chrome grille with fine mesh inserts, 10-way captain’s chairs upholstered with top-quality leather, tuxedo stitching and embroidered logos on the seatbacks. Satin gloss Lacrosse Ash wood grain accents and real brushed aluminum panels give the dash, center console and doors an upscale look and feel. Standard 20-inch, 16-spoke polished aluminum wheels give the truck a commanding presence on the road.
- With more customers interested in personalizing their trucks, Ford is offering the largest selection of wheels in the segment with 13 offerings across the F-150 lineup.
- Under the hood, the new F-150 will be powered by three modern V-8 engines, mated to either a 4-speed or a new fuel-efficient 6-speed automatic transmission. The engines include:
- 5.4-liter, 3-valve Triton V-8, which has been optimized for better performance with improved horsepower and torque, and is capable of running on E85 (85 percent ethanol and 15 percent gasoline), regular unleaded gasoline or any blend in between. 4.6-liter, 3-valve V-8, which is new for F-150. Both the 5.4-liter and 4.6-liter 3-valve V-8’s utilize open valve injection. This unique feature improves the flow of fuel into the combustion chamber, which results in an increase in horsepower during towing and reduced emissions. 4.6-liter, 2-valve V-8, a third V-8 choice in the line-up that delivers more horsepower with the same fuel economy performance as the outgoing truck’s V-6.
- This all-V-8 engine lineup delivers a fleet-average 1 mpg improvement in fuel economy versus the outgoing F-150.
Most ‘Smart’ Features
- Ford’s researchers spent thousands of hours listening to truck buyers to gain inspiration for a host of smart new features for the new 2009 Ford F-150.
- It starts with the clever interior, which features a flow-through console that has been lengthened by approximately 2 inches and is large enough to stow two or more laptop computers. Special ridges are molded into the edges of the bin to accommodate file folders. The console also has a multi-tiered, removable tray and locks to protect valuables.
- More than 30 storage areas are built into the interior, ranging from a bin on the top of the instrument panel to a number of small spaces designed to accommodate tools like cell phones, MP3 players, PDAs and gate access cards.
- A redesigned, more ergonomic shifter remains on the console. New, larger buttons and switches are ergonomically designed and within easy reach and view of the driver. A USB port and auxiliary MP3 player input are conveniently mounted on the dash. Two 12-volt outlets are located on the dash and center console.
- Even the pickup box on the new F-150 breaks the mold with clever and capable features the competition cannot match. The class-leading cargo capacity of 65.5 cubic feet is only the beginning of the story.
- The F-150’s pickup box is made easier to use, more flexible and accessible with such new features as Ford’s industry-exclusive Tailgate and Box Side Steps, Stowable Bed Extender and Cargo Management System.
- Other clever features on the truck, including Ford’s Easy Fuel™ Capless Fuel-Filler System. When fueling is completed and the nozzle is removed, the system automatically seals shut, reducing emissions.
- The new 2009 Ford-150 also will allow truck customers to be connected to the world like never before. Ford has been working with Microsoft, Sony and SIRIUS to offer customers leading technologies to help them stay connected with their lives while on the road including:
- Industry-exclusive Ford SYNC™, a voice-activated, hands-free, in-vehicle communications and entertainment system offers even more functionality for the 2009 model year, with 911 Assist and Vehicle Health Report. SIRIUS Travel Link™ that when combined with voice activated navigation will provide users with a suite of data services including real-time traffic, coast-to-coast weather conditions and fuel price information for over 120,000 gas stations. Voice-activated navigation that integrates several functions, including voice recognition destination entry, climate control and SIRIUS satellite radio into one easy-to-use system, displaying them on an 8-inch touch screen display. Sony audio system that features 700 watts of power, 5.1 surround sound and 10 Sony speakers and amps and is certified by Sony to deliver a unique, rich listening experience.
Ford says “We know how important the F-150 is to our customers,” said O’Leary. “With the new 2009 F-150, we are delivering a top-quality truck lineup that is second-to-none in capability, features and a range of choices that will continue to make Ford America’s favorite truck.”
Tags: 2009 FORD F-150, Ford F-150, Ford Trucks, truck, Trucks
NASCAR Busch series, which will be called the Nationwide series in 2008 and beyond:
A source at Ford Motor Company says the motorsports division expects the Ford Mustang to replace the Fusion in the NASCAR Busch [Nationwide Series in 2008] series.
That said, it may not be a done deal. Reportedly Chevrolet is balking at running the Camaro in the NASCAR series. Rumors suggest that Dodge is considering a Busch series version of the Challenger, which just went on sale at a price of under $38,000, for delivery in 2008. Dodge will build 5,000 Challengers in 2008, and expects to increase that number by sevenfold for 2009. Sales expectations for the Chevrolet Camaro are higher. With the discontinuation of the Monte Carlo, Chevrolet has no sports coupe aside from the Corvette and the small Cobalt SS, and won’t until the Camaro is introduced. The Corvette will continue to race in the American Le Mans and Grand-Am series, though one contingent within General Motors is pressing for a body change for the ALMS GT1 class, where GM’s two factory Corvettes literally have no competition: They’d like to see those Corvettes rebodied as Camaros to help launch that model, which won’t hit the market until well after the Challenger.
Also, the move to “pony car” coupes could cause a problem for Toyota. The Camry Solara, a two-door sedan version of the top-selling car in the United States, may disappear after the 2008 model year. Sales are dismal; Toyota is expected to build only about 30,000 Solaras this year, compared to about 400,000 Camry sedans. One possibility at Toyota: Automotive News says that the company is expected to introduce a new Celica sports coupe in Europe in 2009. If that car comes here, it could be raced in NASCAR. The discontinued Celica made some appearances in the now-defunct NASCAR Dash series. If the move to the Mustang, et al, is to be made for 2009, that announcement would be expected soon after the first of next year.
Tags: Chevrolet Camaro, Chevrolet Corvette, Ford Mustang
General Motors Corp. and Ford Motor Co. will probably say December U.S. auto sales fell as consumers reined in spending, ending a year with the lowest demand for cars and trucks in a decade.
Deliveries dropped about 5.6 percent at GM, 7.8 percent at Ford and 7.9 percent at Chrysler LLC, based on the average estimates of six analysts in a Bloomberg survey before tomorrow’s reports. Smaller declines at Japanese rivals such as Toyota Motor Corp., which bumped Ford from the No. 2 spot at midyear, may help them gain market share over Detroit’s money- losing trio.
Americans bought about 16.1 million cars and trucks for the year, the least since 1998, with year-end gasoline prices exceeding $3 a gallon for the first time and consumer confidence at a two-year low. Housing starts, one barometer for sales of profitable pickup trucks, are in the deepest slump in 16 years.
“The housing market and credit crunch are really affecting consumers,” said Efraim Levy, an equity analyst with Standard & Poor’s in New York and one of the forecasters predicting 2007 sales of 16.1 million. “It’s definitely been a weak year.”
All three of Japan’s biggest automakers will probably report declines for December while collectively gaining market share, said Jesse Toprak, an analyst with Edmunds.com in Santa Monica, California. He predicts declines of 2.9 percent for Toyota, 0.8 percent at Nissan Motor Co. and 1.4 percent for Honda Motor Co.
Ninth Monthly Drop
A monthly decline in December would be the industry’s ninth for 2007. Analysts such as Levy and Goldman Sachs’ Robert Barry expect annual U.S. sales to decline by about 500,000 vehicles from 2006.
Sales of 16.1 million vehicles for the year would be the lowest total since 15.6 million vehicles were sold in 1998. The industry set a record in 2000 with 17.4 million sales.
The industry’s annualized sales rate for December probably fell to 15.9 million cars and light trucks, the third-lowest of the year, according to the average estimate of six analysts and 24 economists surveyed by Bloomberg.
Forecasts for an even tougher 2008 have helped trigger stock-price declines of about 42 percent at GM and 28 percent at Ford from their October highs.
“Gas prices and the housing market will continue to determine what type of vehicle, and how many of them, consumers will purchase in 2008,” Toprak said in a Dec. 27 note. He predicts light vehicle sales will fall to 15.9 million in 2008.
The average price of a gallon of gasoline rose 31 percent for the year to $3.05 on Dec. 30, according to the American Automobile Association. The Reuters/University of Michigan final index of consumer sentiment for December declined to 75.5, the lowest since October 2005.
GM Slide
GM’s sales dropped an estimated 7 percent last month even as the Detroit-based automaker increased incentives on full-size pickups such as the Chevrolet Silverado, Peter Nesvold, an analyst with Bear Stearns in New York, said in a Dec. 24 note.
Redesigned cars such as the Chevy Malibu and Cadillac CTS, while selling well, weren’t enough to “move the needle,” he said.
GM, which lost its lead as the world’s largest automaker to Toyota in the year’s first half before regaining the title, had a 6.1 percent U.S. sales decline through November. It would need a 68 percent sales jump over December 2006 results to avoid its eighth consecutive annual U.S. sales decline, according to Autodata Corp. of Woodcliff Lake, New Jersey.
Dearborn, Michigan-based Ford probably won’t be able to repeat its surprise November increase, which ended a streak of 12 monthly drops, analysts said. The automaker’s sales dropped an estimated 3 percent in December, Goldman’s Barry estimated.
Ford Trucks
“A weak product cadence and aggressive competitor discounts” for pickup trucks probably hurt Ford’s sales to individual customers, Barry said in a Dec. 21 note. Ford depends on trucks for about two-thirds of its U.S. vehicle sales. The F- Series pickup, the nation’s top-selling vehicle, had a 12 percent sales drop in the year’s first 11 months.
Ford, which now ranks No. 3 in the U.S. behind GM and Toyota, would need to more than double December sales to prevent its seventh-straight annual U.S. decline.
Auburn Hills, Michigan-based Chrysler, the fourth-largest automaker for U.S. sales, would need a 35 percent boost from the year-earlier December to equal the 2.14 million cars and light trucks it sold for all of 2006. Its sales dropped for six straight months through November.
Chrysler’s December sales more likely fell 6 percent, even while the company remained “aggressive with incentives,” Richard Kwas, a Wachovia Capital Markets analyst in Baltimore, wrote on Dec. 27.
He expects a 5 percent contraction in truck deliveries for Chrysler, which depends on such vehicles for about 75 percent of its U.S. total, more than any other automaker.
Stocks and Bonds
Ford rose 3 cents to $6.73 on Dec. 31 in New York Stock Exchange composite trading; its shares lost 10 percent in 2007. GM fell 41 cents to $24.89 and declined 19 percent for the year. Toyota’s American depositary receipts fell 43 cents to $106.17; it’s down 21 percent for the year.
GM’s 8.375 percent note due July 2033 was unchanged on Dec. 31 at 80.75 cents on the dollar, yielding 10.57 percent, according to Trace, the NASD’s bond-price reporting service. Ford’s 7.45 percent note due July 2031 rose 0.25 cent to 74.75 cents on the dollar, yielding 10.33 percent.
Credit-default swaps on GM debt dropped 3 basis points on Dec. 31 to 727 basis points, according to CMA Datavision in New York. Ford’s increased 3 basis points to 787 basis points.
The contracts are designed to protect bondholders against default. A decline in the price indicates a rise in the perception of a company’s credit quality.
The following table provides estimates for car and light- truck sales in the U.S. Estimates for companies are percentage changes from December 2006. Forecasts for the seasonally adjusted annual rate, or SAAR, are in millions of vehicles.
The SAAR average is based on forecasts from six analysts and a survey of 24 economists. The analysts’ estimates are based on daily selling rates. December had 26 selling days, the same as December 2006.
