Ford Explorer Sets August Sales Record Despite Tire Recall
The Explorer, the country’s best-selling sport-utility vehicle but linked to the massive recall of Firestone tires suspected in dozens of fatal accidents, sold an August-record 40,157 units, Ford Motor Co. said Friday.
Sales are being closely watched because the Explorer is a huge profit center for the No. 2 auto maker, which has sold about 430,000 of the mid-size SUVs in the U.S. each of the last two years.
Explorer sales were nevertheless down 0.8% from August 1999 when tabulated by daily sales rate, because there were 27 sales days last month compared with 26 in August last year, when Ford sold 39,000 Explorers.
Bridgestone/Firestone Inc. has recalled 6.5 million tires suspected of defects that cause their treads to fly off at highway speed. Most of the tires were installed on the Explorer and other Ford light trucks.
The largest auto makers reported final August figures Friday, with a handful of smaller manufacturers to report after the Labor Day holiday. Autodata Corp., which tracks the U.S. market, estimated that industrywide year-over-year sales grew 0.5%.
General Motors Corp., the No. 1 U.S. auto maker, was down 5.4% as sales of both cars and trucks slumped, but No. 3 DaimlerChrysler’s U.S. brands were up 3.9% on the strength of booming SUV sales.
George Pipas, Ford’s market sales analyst, said the slight dip in the Explorer’s sales rate can’t be attributed to the tire recall.
“That’s not to say there wasn’t an impact, but there are a lot of other things going on out there, like competitive incentives or moderating sales in the economy,” he said. “Eight-tenths of a percent could be anything.”
Sales of the Explorer remain strong despite the shadow of the tire crisis and congressional investigation of Ford and Firestone, said Tom Shaver, senior partner at market researcher J.D. Power & Associates in Agoura Hills.
“At this time, there’s no significant difference we’re seeing at all,” Shaver said. “It’s the standard trend in sales for the Explorer going back three years.”
Overall, sales of Ford and the other brands the auto maker owns--including Lincoln, Mercury, Jaguar, Volvo Cars, Aston Martin and Land Rover--were down 3% from August 1999.
That’s not necessarily worrisome news to Ford, considering that its results are being compared with a record 1999 across the industry, in which sales totaled 16.9 million vehicles. Sales during the first four months of this year were churning at 10% ahead of a year earlier, and the second four months were even with 1999, Pipas said.
At the current pace, the U.S. market could well set another record of about 17 million vehicles this year, Pipas said.
“The whole market remains relatively robust, with the Fed completing its cycle of raising interest rates and the stock market showing strength again,” Shaver said.
Sales of GM passenger cars and light trucks were each down about 5.4%. Minivans in particular lost sales to DaimlerChrysler, which boosted incentives as high as $3,000 per vehicle last month. Among GM sedans, most Buicks posted double-digit declines, and only one Cadillac car, the new technology-packed DeVille, posted a sales gain.
“GM’s poor showing in the car segment could spur it to get more aggressive on incentives,” said Nicholas Lobaccaro, an auto analyst at Lehman Bros. in New York.
Booming SUV sales at Chrysler and overall at DaimlerChrysler’s U.S. brands--which also include Dodge and Jeep--yielded an August record. Minivan sales soared, with Chrysler’s Town & Country up 95% and the Dodge Caravan up 57% from the same month last year.
Among other auto makers reporting Friday, Volkswagen said sales rose 5.8%, for its best single month since 1974.
BMW, Honda Motor Co., Toyota Motor Corp.’s Lexus luxury division and Hyundai Motor Co.’s Kia brand said they recorded their best monthly sales ever.
Record August sales were racked up by VW’s Audi luxury division, along with DaimlerChrysler’s Mercedes-Benz, the Toyota brand, Mitsubishi Motors Corp. and Daewoo Motor Co.
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TIRE PROBE WIDENS
U.S. safety officials issue warning on more Firestone tires. A1
