Early June auto sales figures from
appear to be signaling improvement in the economy.
June is shaping up to be Ford's best month since July 2008, with a sales decline that will likely end up between 10% and 20%, says Ford analyst George Pipas, who briefed reporters Monday.
The improving trend has led Ford to boost its third-quarter production rate by 25,000 units to 485,000 units. That is on top of a planned 10% increase to 460,000 units that Ford announced last month. Planned third-quarter production is now 16% higher than 2008 third-quarter production.
For the industry, June will likely be the first month since September 2008 that North American vehicle sales will decline by less than 30%, Pipas says. It now appears that 2009 domestic vehicle sales will total about 10 million units, he says.
While higher than the 9.5 million units projected earlier in the year, the number is still historically low. The last time North American vehicle sales slipped below 10.5 million was 1982, when they totaled 10.3 million, according to J.D. Power. The last time they were below 10 million was 1970, when sales totaled 9.8 million, J.D. Power says.
The preliminary June numbers indicate that Ford, the only U.S. automaker to avoid government bailouts and bankruptcy, has gained market share, Pipas says. The company's sales decline may have been substantially less than the overall industry decline.
"To me, the most important thing, regardless of where our sales or industry sales come out, is that we seem to have hit bottom," Pipas says. "As tough as the economy is right now, sales rates are no longer trending lower. They seem to want to trend higher.
"But even with a modest recovery, this will still be one of lowest sales years in 30 or more years, so we are not popping the champagne corks," he says. "That would be getting ahead of ourselves."
In May, Ford sales fell by 24.2% from a year earlier, which until this month represented the lowest sales decline since July 2008.