Cox Automotive has posted its forecast of U.S. car sales for October. Overall, it expects unit sales to slide by 2% compared to October 2017. Among the nine manufacturers that dominate the America market, Ford Motor Co. (NYSE: F) is expected to have the largest drop, off 9.9%. It is another challenge to the Ford turnaround, which got a positive boost when the company announced earnings recently.
Because of trouble in other markets, Ford needs success in the United States. In October, unfortunately, its sales, expected to be 180,000, will be barely better than those of Toyota Motor Corp. (NYSE: TM) at 174,000 (down 7.7%) and Fiat Chrysler Automobiles N.V. (NYSE: FCAU) at 176,000 (up 14.8%). Ford’s market share is expected to fall to 13.6% from 14.8% in October of last year.
Market leader General Motors Co.’s (NYSE: GM) sales are expected to drop 9.4% to 229,000. Its drop off is further evidence of how well Fiat Chrysler will do compared to the overall market.
Investors drove Ford shares up almost 10% after earnings to $9. This is still well short of the 52-week high of $13.48. Revenue for the third quarter reached $37.7 billion, up from $36.5 billion in the same quarter of last year. Net income was $991 million, compared to $1.57 billion last year. North America was Ford’s strength for the period with revenue at $22.3 billion, up $1.4 billion.
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Sport utility vehicle and light truck sales drove Ford’s North America success. Car sales fell. This will get worse as Ford withdraws several models from the market. In theory, this lowers revenue and improves the bottom line. That remains to be seen.
Ford cannot survive much more trouble in its home market. It has been slow with details about its turnaround and possible huge investments in autonomous and electric cars. Ford risks falling into the third or even fourth place among manufacturers based on sales. A 10% drop in October shows how deep that threat is.
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