Ford Outsells GM, Toyota OK

Many experts expected that February would be a bloodbath for Toyota (TM) due to its recalls of 8.5 million cars worldwide and a large amount of negative publicity about potential cover-ups of safety data. Domestic sales of cars and light trucks by the Japanese company were only down 8.7% to 100,027.

Almost as important was the news that Ford’s (F) February sales moved ahead of GM’s for the first time in over a decade. Ford’s sales rose an extraordinary 43% to 142,285. The company said its market share in America moved up to 17%.

GM did less well, but it had to contend with the drop in sales of its discontinued brands which include Pontiac and Saturn. GM’s February sales were up only 11.5% to 141,951. GM backed out sales of the brands it has closed and said sales for its remaining brands were up 32%.

The Ford news affirms the risky decision by CEO Alan Mullaly to borrow $23 billion in late 2006 just as the downturn in the car industry hit. Ford pledged almost all its assets for the capital. The money was crucial because it allowed Ford to stay independent as the worst car market in half a century took GM and Chrysler into Chapter 11.

Douglas A. McIntyre