Behind the Numbers with Erich Merkle: September 2018

This is going to seem more like a weather report than a sales column at first.  That’s because U.S. sales were impacted by storms in different ways in September, both last year and last month.

Last year at this time, we were seeing strong sales increases from pent-up and replacement demand in the greater Houston area as a result of Hurricane Harvey, which hit in August 2017.  This year, Hurricane Florence struck the Carolinas in September and had some impact on sales in the opposite direction.  While not as severe as Harvey, Florence did create a depression in sales that factored into the negative year-over-year sales performance for both Ford and the overall industry. 

Overall industry sales were down about 5 percent in September, but still very strong numbers with a 17.9 million seasonally adjusted annualized rate (SAAR).  Ford’s U.S. sales were down 11.2 percent.

Now I know some of you will ask me… why were Ford’s sales down so much more than the industry? It is a good question, and to answer it we need to get into a little geography.  Texas is the biggest pickup market. We’re the No. 1 pickup truck in Texas and the best-selling brand in the state.  Therefore, Harvey hit us harder in August of 2017, but we also benefited more from the pent-up and replacement demand for the month of September in 2017.  This made our comparisons much more difficult than other automakers, as F-Series represents a larger share of our sales than any other single vehicle does to another automaker.   

No surprises.  F-Series sales were down 8.8 percent in September. It’s important to remember that we’re comparing ourselves to last year – a time as I just mentioned when replacement demand for trucks following Hurricane Harvey was high, resulting in a 22 percent spike in sales.  Nevertheless, F-Series had a great month.  We sold more than 75,000 trucks in September.  And year to date, we’re only about 19,000 trucks behind 2004, which was a record year for F-Series.  That’s not to say we’ll beat the 2004 record, I’m just pointing out that 2018 is clearly on track to be another a very strong year for F-Series.

Ford brand SUV sales were down about 2.5 percent in September, but year to date we’re still ahead of last year’s record pace with 600,847 SUVs sold.  Expedition sales were up 27.4 percent in September with strong transaction pricing at $63,600 per truck, as many customers are requesting high-end Platinum models. 

As we finish out the rest of the year, we need to work hard to maintain our share position prior to the launch of some of our all-new products like Ranger, Escape and Explorer.  That said, there are many opportunities ahead.  We hope to achieve another record year with our Ford brand SUVs, especially as more stock becomes available for Expedition, and we’re looking forward to having a really strong truck year with F-Series, making it 42 consecutive years as America’s best-selling truck.

 

 

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