Ford to post U.S. sales rise in July from year-ago

Ford Motor Co will report its U.S. sales for July rose from a year ago on a late-month surge under the federal government's "Cash for Clunkers" incentive program, senior U.S. executives said on Sunday.

The July increase marks Ford's first year-over-year monthly rise since November 2007, just before the U.S. economic downturn began, and the first increase for any of the largest automakers since the start of the financial crisis a year ago.

The result is "important to Ford, but it is also a very good indication for the economy," Ford U.S. sales chief Ken Czubay said in a telephone interview.

"It was a deep hole that the entire economy was in," Czubay said. "We may not be out of the hole, but we are seeing very encouraging signs in July."

Ford, the only U.S automaker that has not restructured in bankruptcy with federal funding, has consistently outperformed the other six largest automakers in the U.S. market this year, with less severe sales declines than its rivals amid the lowest vehicle sales rate in nearly three decades.

"The beginning of July was firming up for us and then a week ago last Friday the government's 'Cash for Clunkers' program kicked in and there was a substantial increase in business and that kicked us over the top," Czubay said. "We don't know about the others, but we do know that we are going to have an increase year over year."

The "Cash for Clunkers" program took effect on July 24, a week before the end of the July sales period. Automakers will report their July U.S. sales on Monday.

The "Cash for Clunkers" program provides consumers payments of up to $4,500 for the purchase of a new car when an older vehicle is traded in for a more fuel-efficient one. The initial $1 billion of funding could cover 222,000 to nearly 286,000 vehicles.

Ford will also report its first year-over-year retail sales increase since July 2007, supported by sales of more fuel-efficient vehicles, chief sales analyst George Pipas said.

"You are going to see large gains in almost every Ford product that is powered by a four-cylinder engine -- the Focus, the Fusion, Fusion Hybrid, the Escape small utility and its hybrid version, the companion Mercury products -- that is where the demand was, particularly this past week," Pipas said.

July's monthly U.S. seasonally adjusted annualized sales rate is expected to be the strongest of 2009, though weak by historical standards.

Full story