By Shawn Langlois
SAN FRANCISCO (Dow Jones) -- Ford Motor Co., clinging to its
position as the only domestic automaker not on federal life
support, reported on Wednesday a 41% drop in March U.S. vehicle
sales and posted a first-quarter production decline.
Ford (F) handed in monthly sales of 131,465 cars and trucks,
down from 222,337 a year ago. Ford, Lincoln and Mercury brand car
sales dropped 36.6% to 46,467 vehicles while the truck side saw a
43.7% drop to 78,640.
"I think I can say that we have been seeing some encouraging
signs in recent weeks that the pace of economic decline could be
moderating," Emily Kolinski Morris, Ford's senior economist, said
in a conference call. These signs include stabilizing consumer
confidence and improvement in some housing indicators, she
explained.
Retail sales fell 36%, while sales to corporate buyers and
rental car companies were down 50% as Ford continues its move away
from relying heavily fleet customers.
The Volvo division, which is currently being shopped around as
the only remaining brand of Ford's European carmaker stable, saw
its total sales drop 31.4% to 6,358 vehicles.
Ford said that Ford, Lincoln and Mercury inventories at the end
of March totaled 408,000 units, about 27% lower than a year
ago.
The Dearborn, Mich.-based automaker produced 349,000 vehicles in
the first quarter, a decline of 26,000 cars and trucks from a year
ago.
Separately, Ford halted production at one of its two F-150
pickup truck assembly plants for three weeks in the face of slow
consumer demand.
"Aligning production and inventory with demand is a key element
of our strategy to strengthen our brand and improve customer
value," said Jim Farley, head of marketing. "Our disciplined
approach to the market in these challenging times helps us to
minimize costly incentives that erode brand value while we're
delivering our strongest-ever product lineup."
On the incentive front, both Ford and General Motors Corp. (GM)
rolled out customer job-loss protection plans on Tuesday aimed at
pushing hesitant shoppers into making the new-car plunge. Hyundai
previously launched a similar approach, which helped the Korean
carmaker avoid some of the hefty industry declines.
Ford was the first of the major automakers to report on what was
sure to be another rough month for the industry. Analysts polled by
Thomson Reuters are looking for a seasonally adjusted annual rate
of sales of 8.9 million cars and trucks.
The tally came in at 9.12 million vehicles in February, which
was the lowest level since December 1981, according to
Autodata.
The monthly results, no matter how dismal, will still take a
back seat to further speculation as to what's next for GM. With the
CEO Rick Wagoner gone and a new deadline imposed by the White
House, bankruptcy concerns are again dogging the company.
In fact, President Barack Obama reportedly said he believes a
"quick and surgical" bankruptcy for GM is most likely the next
step.