Ford’s Sales Are Down, But Investors Told Not To Panic

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Ford Motor Company’s sales fell by six percent last month, but some analysts were quick to blame it on the fact that May 2016 had two less selling days than 2015.

But Ford overall experienced a mixed sales bag in May: Their F-Series pickups sold strongly, and continue to be among the company’s most profitable vehicles.

Their SUV didn’t sell quite so well; the Explorer and the smaller Edge saw tumbling sales, although the Escape sold better.

Their cars, meanwhile, all fared badly – and they all fell.

The Ford Fusion sedan saw a 21.5% fall in sales, but analysts point out that sedan’s in general are on the way out as buyers now prefer trucks and SUVs.

The luxurious Ford Lincoln was a ray of sunshine for the brand, with sales rising by 7% last month.

How Are Ford Investors Feeling?

The auto industry has been doing well for the last few years in the U.S., and as such it’s expected to hit a sticky point soon – as invariably happens in this most cyclical of industries.

The market is currently stabilising, and further growth is not anticipated.

Analyst Karl Brauer explained: “With new-car demand stabilising in recent months, we’re left with a market that is far more dependent on sales within a given month.

“Given the record numbers we experienced in 2015, and the continued projection for 17-plus million sales this year, the industry remains in a very good place.”

Ford might be tempted to boost discounts in a bid to promote more sales growth, which is not something that investors like to hear.

Discounts, after all, slow profit.

Analysts generally agree that Ford’s profits will tumble at some point – but not just yet.

Will Titterington
  • 2nd June 2016

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