No. 2 dealer criticizes Ford's F-150 strategy
LAS VEGAS (Reuters) -- The head of the second-largest Ford Motor Co
dealership group on Friday said the automaker was not doing enough to defend
the market-leading position of its F-series pickup trucks.
"What's really bothering us at Ford has been the weak F-Series sales the
last two months," said Earl Hesterberg, chief executive officer of Group 1
Automotive Inc. (Charts)
The second-largest Ford dealer in the U.S. says Ford's efforts to
defend its market leading F-150 franchise are not enough.
"For most Ford dealers, especially dealers outside the urban areas, that's
really our bread and butter," he said.
Sales of its F-Series pickup trucks, which have long ranked as the
best-selling vehicles in America, were down 15 percent in January. The
company has warned that it would see its overall market share fall through
the third quarter.
Hesterberg, who was speaking on the sidelines of an automotive conference
organized by J.D. Power, said Ford needed to shore up support for its
F-Series trucks at the showroom floor.
"We certainly don't think Ford has been defending the F-Series for the past
several months," he said. "Now what does that mean? Does it mean
advertising? Does it mean incentives? I don't really know, but I can tell
you other Ford dealers that I talk to - and we're the No. 2 Ford dealer--
for us the F-Series is our lifeblood."
Ford spokesman Jim Cain said U.S. pickup truck sales in recent months had
been skewed by "fire sale" incentives intended to clear out inventory of
Dodge Ram trucks from DaimlerChrysler AG (Charts) and the outgoing version
of the Toyota Tundra.
Toyota tops Ford in latest sales
Analysts have cautioned that Ford's F-series trucks also face tougher
competition in coming months from revamped truck offerings from rivals
General Motors Corp. (Charts) and Toyota Motor Co (Charts), which launches a
redesigned Tundra this month.
But Cain said Ford also would benefit from the launch of a new version of
its heavy duty F-series truck, the Super Duty. The Super Duty truck model
accounts for 40 percent of Ford's F-series sales volume. The new version of
the Super Duty has just started selling.
"We have a lot of arrows in our quiver," he said, adding that Ford's sales
incentives were competitive.
Ford Chief Executive Alan Mulally was scheduled to meet with dealers this
weekend in Las Vegas, his first appearance at a national dealer convention
since taking the top job at the automaker last year.
Separately, Hesterberg said he remained concerned that inventories could
build back up for the U.S. automakers this year as they did last year,
raising costs for dealers who are forced to finance the unsold vehicles.
"I absolutely have a concern about inventories and it's been an ongoing
concern in our company for six to nine months," he said.
Hesterberg said that the U.S. automakers needed to break out of the cycle of
sharp declines in monthly showroom sales that he said were cutting into the
profitability of their dealers.
"They have to arrest the year over year significant decline in retail
sales," he said. "You can always have a month when you're down 2 percent
over last year, but when you're having consecutive months when you're down
(by double digits) your distribution network is going to get weaker."
"Your best, last and only line of defense-a cohort of Roman Heavy Infantry"