Ford banks on new products
Firm to roll out four new models in '05.
By Eric Mayne / The Detroit News
2005 Ford Mustang
SANTA MONICA, Calif. - Ford Motor Co. is counting on a slew of new products, including the hotly anticipated new version of the Mustang pony car, to help the blue oval brand pull out of its long market share decline.
In addition to the Mustang, Ford is rolling out three other key products for the 2005 model year, the new Five Hundred sedan, Freestyle crossover and redesigned F-Series Super Duty pickup.
"A large part of what we'll do will depend on how fast the new product starts to arrive," said Ford division president Steve Lyons.
With the exception of the new F-150 pickup, which was redesigned for 2004, the Ford showroom lacks fresh cars and trucks to win new buyers.
"Today, we're selling one car - Focus," he said. "Taurus is Taurus. (Its) retail numbers are very low. Crown Victoria is all fleet and we haven't built one Mustang since April."
Ford expects to see an immediate boost when the new retro-styled Mustang debutsin October. The Mustang has tens of thousands of loyal buyers eager to get their hands on the latest evolution.
"We'll sell every Mustang we can get our hands on," said Jim Crowley, president and chief executive officer of The Automotive Group, the holding company for two southern California Ford dealerships.
The Five Hundred, a large sedan with a host of new features such as all-wheel drive, and the Freestyle, which combines sport utility vehicle and wagon attributes, are also crucial to Ford's planned resurgence.
Ford shifted plans in the past year to focus on profitable retail sales, while forgoing some sales to rental car agencies and other fleet customers. Through August, Ford Motor Co. - including its Lincoln Mercury division and European luxury brands - had a 20.7 percent share of the daily rental market. That's down 4.6 percentage points, compared with the first eight months of 2003.
But Merrill Lynch analyst John Casesa said Ford needs to launch new cars and trucks that can stem the market share slide.
"This can't continue indefinitely because it would be, clearly, a flawed strategy,"
Ford has also has been less aggressive than GM in offering incentives, focusing on profits over volume.
The strategy has helped Ford increase its automotive earnings in North America. In the second-quarter, pre-tax profits in North America rose $10 million to $455 million even as revenues dropped
"Their market share is probably bottoming out," said David Healy, an analyst with Burnham Securities.
Lyons predicts the Ford brand will record total unit sales of 2.9 million for the year, up about 5,300 over unit sales in 2003.
Fueled by the steady performance of the popular F-150 pickup, Ford should surpass the F-Series record of 911,000, established in 2001, Lyons said.
Through August, Ford is well ahead of the pace needed to break 2001's record of 911,000 F-Series sales.
"We'll get our 912,000 for sure," Lyons said.