Ford Motor's striking market-share plunge should be over within six months, and the company is banking on new products to regain share while allowing it to cut back incentives, CEO Bill Ford said Wednesday in an interview with USA TODAY.
Boosting market share without also boosting rebates is almost unheard-of in today's discount-crazed auto market. Toyota is an exception, gaining almost a full percentage point this year while trimming its average incentive a few dollars, according to industry tracker Autodata.
Ford Motor has lost ground because it's been trying to sell old models against rivals' newer designs, has failed to make its newer models look different than the old ones and hasn't offered a big enough variety of cars, Bill Ford said in a blunt assessment.
"When you're trying to compete in a car segment with an old Taurus and not a whole lot else ... it's tough" to keep sales up, even with big incentives, he said.
Ford said he's so intent on trimming the cost of incentives that he might let Chevrolet outsell the Ford brand this year, for the first time in 17 years, rather than pouring money into keeping Ford the best-selling brand in the USA. "I don't like to lose, but I'm not going to do anything crazy," he said.
Through October, Ford Motor's Ford brand has sold just 23,083 more vehicles than General Motors' Chevrolet brand has.
Ford, the great-grandson of founder Henry Ford, took over the world's No. 2 car company in October 2001. Since then, its share of U.S. new vehicle sales has fallen to 19.7% from 23.2%. That 3.5-point drop is equivalent to about 500,000 fewer vehicles. In the same period, Ford's incentives have nearly doubled to an average $3,611 per vehicle, according to Autodata.
Toyota and Honda have largely escaped the downhill spiral, holding their incentives to an average of less than $1,000 per vehicle.
Some of Ford's market-share loss has been because Ford cut back low-profit and no-profit sales to car-rental companies and other multivehicle fleet buyers. "Heck, we own Hertz. The easiest thing in the world would be for us to say, 'OK, Hertz. You're taking 50,000 of these this month, 75,000 of these in six months,' " Ford said. "In fact we're not doing that," and the percentage of Ford products in the Hertz rental fleet has declined.
"We have the product now to go after share where we didn't before," he said, referring to seven models being launched this fall, including the redesigned Ford Mustang, Escape hybrid sport-utility vehicle and Five Hundred sedan.
I like Bill Ford's candor