Posted by: David Welch on January 4, 2008
Few industries revel in statistics, sales crowns and defining moments the way the car business does. So when Toyota passed General Motors last year for the global sales crown, it made headlines across the globe. Really, it’s an almost meaningless event in business terms since even the casual observer could foresee that crossing of fates between the two companies coming for years.
This week we have another milestone. Toyota outsold Ford in the U.S. market last month by a tally of 228,000 cars to Ford’s 215,000. Ford still sold more vehicles in 2007, but the gap is now less than 200,000 vehicles. But in the grand scheme of things, this week’s news isn’t really staggering. But take a look at the seven-year wake leading up to this event. That’s staggering. In 2000, Ford sold 4 million cars, about what GM sold this year. From then until now, Ford’s sales have fallen by 1.3 million vehicles. Imagine taking Honda’s sales in 2000 and simply wiping them out. That’s how far Ford has fallen in seven years. In that time, Toyota sales soared by 1 million vehicles to 2.6 million. So it wasn’t just the industry darling who prospered at Ford’s expense. No wonder the company’s stock hit a 22-year low at $6 a share today.
That’s a long way down, and not the last of it. Like its crosstown rivals, Ford is struggling to cope with $3 a gallon gasoline. The housing crisis continues to sap home equity, which buyers once used to buy cars. And even fatter incentives are luring consumers to trade in for something new. For Ford, its highest-volume cars, like the yesteryear Mustang, brawny F-150 pickup, gas-chugging Explorer and unwanted Taurus sedan, are all frozen on the lot. Only the Fusion sedan and Edge suv seem to have captured a following. Looking at Ford’s lineup and the economy, CEO Alan Mulally’s second year looks even tougher than the first.