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Mayank Marwah
Mayank Marwah
Articles (502) 

Ford Off to a Dull Start in January 2018

The all-new Navigator looks set to pull customers away from Cadillac

February 05, 2018 | About:

The Michigan-based automaker Ford (NYSE:F) is off to a lackluster start as it posted a 6.6% January sales decline to 161,143 units in the U.S.. While the company’s truck segment registered a 2.2% sales growth year over year, car and SUV segment witnessed losses, down 23.2% (31,661 units) and 5.9% (55,282 units), respectively. Retail and fleet sales, on the other hand, plunged 4.3% and 12%.

Bird’s-eye view

Despite a slow start, the company can take some positives out of it like the continuous shift of customers from cars to F-Series trucks, and most importantly, SUVs such as Explorer, Edge and Escape, whose sales surged 10.1%, 6% and 0.4%, respectively.

As far as cars are concerned, Fusion sales dipped 33.3% and Focus sales declined 31%. What remained the highlight of the month were the F-Series sales, which remained standout. Robust F-Series sales pushed the average transaction price of the same by $1,400 year over year to $47,800. Transaction prices per vehicle stood at $37,000, which was 15% more than the industry average. As a matter of fact, the Blue Oval sold a good mixture of cars and high-margin SUVs helping itself to push the ATP.

Ford brand sales slipped 53.6% to 154,733 units. On the other hand, Lincoln sales plunged 27% to 6,410 units. The key fact from the company’s January auto sales was that more than four-fifth of the Ford vehicles sold consisted of pickups, vans, crossovers or SUVs.

At the end of January, Ford’s inventory level stood at 108 days’ supply. This was more than 68 days’ supply on a month over month basis and at the same time, it also indicates an increase from 95 days’ supply. The reason for very high inventory supply is the cold weather on the East Coast, more leasing and the fact that customers are keeping their cars for longer periods of time.

The high-end Lincoln Navigator has arrived

The company had launched the all-new Lincoln Navigator in November and its demand has risen so high, that it is struggling to keep up its production pace. The car could cost $100,000 depending on its features. The analysts are of the opinion that the new car might attract buyers from Cadillac. The fact that the all-new Lincoln Navigator has fascinating interior design with more interior space along with seats available heating, cooling and massaging options makes it more popular. Rebecca Lindland, the Kelly Blue Book analyst, commented:

"The previous Navigator was fine, but it was nothing like this," "This is a really gorgeous truck." "Cadillac had owned that spot for years," "and now Ford has come in and is a fierce competitor."

Disclosure: I do not hold any position in the stock mentioned in this article.

About the author:

Mayank Marwah
A seasoned writer with keen interest in the automotive, technology, telecommunication, retail and aerospace sectors.

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