A New Hit for Ford?


If analyst estimates are on target - and they're usually not too far off - it looks like U.S. auto sales have continued to be strong in January.

Analysts at TrueCar.com estimate that overall sales of "light vehicles" (cars, SUVs, and pickup trucks) in the U.S. will be up 15.1% in January versus the year-ago month.

That translates into a seasonally adjusted annualized rate (or "SAAR," a widely watched indicator of the health of the auto market) of 15.4 million, comparable to where it was in December - but the highest mark for January since January of 2008.

That's likely to mean good news for nearly all of the automakers. But there might be some extra good news in store for Ford .

Solid gains for Ford in a surging market
TrueCar's analysts see Ford's sales rising about 18.5% in January. That's a good number - better than General Motors' 13.5% - but not quite as good as some rivals. (Volkswagen is expected to post a 26.5% increase, for instance, and Toyota is expected to come in with a 19.7% gain.)

Still, if the analysts are on target, Ford is clearly holding its ground, and maybe even gaining a bit of market share. And it's doing it without excessive incentives: Ford's are down somewhat from December levels (though so are most of its competitors'), according to TrueCar.com.

That's all good stuff. But here's the really good news: Once January's numbers are tallied, we may see that Ford has a new hit product on its hands.

The Detroit News is reporting that Ford may sell over 21,000 copies of its new Fusion sedan in January, a very strong result in what has typically been the year's weakest month for auto sales. That would top the January record set by the previous-generation Fusion - a strong seller in its own right - by almost 50%, the paper said, and put it within striking range of the longtime category leaders: Toyota's Camry and Honda's Accord.

That would be great news for Ford.

The latest hit from Ford's global product line
Like most of Ford's recent products - last year's Escape, 2011's Explorer and Focus - the Fusion has done well in reviews and comparison tests. Ford's recent approach to product development, part of its "One Ford" business plan, calls for developing most new models as "world" vehicles, cars and trucks that will compete well in markets all around the globe. That has resulted in a string of well-reviewed, great-selling products - a string the Fusion looks set to join.

But the new car's success hasn't come without teething troubles. Ongoing problems related to a new engine, the 1.6-liter "EcoBoost" four-cylinder found in some models of the Fusion and Escape, have led to three recalls over a potential fire risk. Those recalls have had their own snafus: Some customers' vehicles have sat at dealers for days due to parts shortages.

It has been an embarrassing situation for Ford, though thankfully one that hasn't led to any injuries - and thankfully one that has affected only a relatively small number of vehicles.

And thankfully, one that appears not to have dented demand for Ford's latest new car.

A slow start, now picking up steam
So why is the Fusion, which was launched last fall, only taking off now? It's a simple matter of supply and demand: It has taken time for Ford's production lines to ramp up and get a full supply of cars to dealers. Ford said at the beginning of January that it had about 28,000 Fusions in transit to dealers, enough to fill out many dealerships' inventories.

If estimates are on target, many of those cars may already be sold - and as U.S. auto sales continue to pick up steam, Ford may have another new hit product on its hands.

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The article A New Hit for Ford? originally appeared on Fool.com.

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