Ford executives can breathe again now that the redesigned F-150 — the high-volume pickup truck that could make or break the company’s turnaround effort — is selling briskly in its first full month on the market, the Detroit News said on Thursday.
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Ford president Steve Lyons told the newspaper in an interview that his company now expects to set a September record for full-size pickup sales – the current record is 74,787 F-series pickups in September 2001.
Lyons reportedly added that, if F-150 sales continue to accelerate in the remaining three months of the year, the Ford brand could avoid losing market share this year – to the end of August, the Ford brand claimed 17.2% of the US market, down from 17.5% last year.
Lyons told the Detroit News that, on average, dealers are selling the new F-150 within six days of receiving the truck from Ford, compared with the 30 to 60 days it typically takes to “turn” a vehicle. Another encouraging sign for Ford is that 55% of the new F-150s sold have been the more profitable four-wheel drive version, the report added.
Rod Lache, of Deutsche Bank Securities, told the paper that, historically, four-wheel drive models account for 40% of big pickup truck sales.
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By GlobalDataThe Detroit News said buyers have been snapping up the posh Lariat version of the 2004 F-150, which features a floor-mounted gear shifter and an interior trimmed in leather and wood.
The paper noted that demand for the pricey versions of the trucks — combined with low incentives — should give Ford a boost in revenue, although the gains will be offset by the $US1,000 to $2,000 in additional costs that Ford engineered into the new F-150.
The Detroit News said the initial F-150 sales push got a major boost from a massive $100 million-plus advertising campaign that runs from TV spots to billboards to banners towed across the sky by aircraft.
Good reviews have helped as well, the paper added, noting that US motoring writers have generally concluded the new F-150 is the best pickup on the market.
Lyons told the Detroit News that Ford’s web site has seen a surge of traffic from truck lovers looking for information on the F-150 – on one day, the F-150 section of the site received two million hits when the entire site typically averages 90,000 hits a day.
The paper said the early demand for the F-150 is welcome news at Ford headquarters where company executives have called the F-150 launch one of the most important in the company’s 100-year history – Ford spent $1.8 billion redesigning the pickup, which accounts for a large percentage of its profits.
The Detroit News noted that, for bargain-hunters, Ford has continued to sell the older version of the F-150 – the “heritage” F-150s are built in Oakville, Ontario, in Canada and are available until next summer, and currently come with a $3,000 discount or zero percent finance offer.
Lyons told the paper the strategy will protect Ford against escalating rebates within the full-size truck market as General Motors entices customers with a $3,500 rebate or zero-percent financing on its rival Chevrolet Silverado and GMC Sierra pickups.
The Detroit News said Ford is currently offering minimal rebates on its new F-150 but that’s likely to change after Nissan begins selling its Mississippi-built Titan pickup later this year and Toyota’s new truck plant in San Antonio comes on line in early 2005.
Deutsche Bank’s Lache told the paper that, given the new full-size [truck] production [plans], “a price war in this segment is increasingly likely.”
