US:Ford begins 0-72 loans, includes subprime buyers
Ford begins 0-72 loans, includes subprime buyers
Mark Rechtin | Automotive News
Ford Motor Co. will crack open the incentives vault for a month-end sales blitz that will offer 0 percent financing for as much as 72 months for Ford, Lincoln and Mercury buyers, including those with subprime credit ratings.
The program, called the Labor Day Sales Event, begins Thursday, Aug. 24, and runs through Sept. 5, the day after Labor Day. It will be available on purchases of nearly all 2006 model vehicles, even ones in tight supply. Zero percent financing will be available to customers with subprime credit ratings, not just customers in the top two tiers, as in past programs.
Dealers were notified of the program in a conference call Tuesday by Al Giombetti, president of Ford and Lincoln Mercury; and Cisco Codina, Ford's group vice president of North America marketing, sales and service.
"It's part of our aggressive 2006 selldown and we want to get our customers the best deal nationwide," spokeswoman Whitney Drake said today. "It will move our 2006 inventory."
Dealers said the program will benefit buyers who might have been turned down because of inability to make a monthly payment.
"I have a customer who was turned down, and he'll be approved," one dealer said. "In a matter of a few days, he'll be in a new car."
The Ford GT and some commercial trucks will be excluded from the offer.
Ford is struggling with too many cars in inventory. As of Aug. 1, Ford Division had 593,100 units in stock. Ford already has said it would cut fourth-quarter production by 168,000 units, or 21 percent of total output. For the full year, Ford now plans to make 3.048 million vehicles in North America, down 9 percent from 2005.
Ford Motor also received a kick in the stomach by being outsold by Toyota Motor Sales for the first time ever in July. Ford is trying to cut back sharply on sales to fleet customers, which had padded its true performance.
Ford has not gained U.S. market share since 1995 and is under pressure to speed up cost-cutting efforts after worse-than-expected July sales and a $254 million loss in the second quarter.
Ford accounted for 18.1 percent of 2006 U.S. auto sales through July, down from a 25.7 percent share in 1995. Its vehicle sales have fallen 9.7 percent through July from the same time last year.
The automaker had said it would accelerate its turnaround plan, dubbed the "Way Forward," to respond to weakening U.S. demand for fuel-hungry trucks and SUVs amid high gasoline prices.
As part of its second restructuring plan in four years, Ford plans to close 14 plants and cut up to 30,000 factory jobs through 2012.
Reuters contributed to this report.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....