If you are waiting to replace your 1978 Ford pickup and you've got the cash or credit to close the deal, there are big bargains to be found in big trucks.
It's no secret that pickup trucks have been Detroit's financial bedrock for decades. Even through the 1973 OPEC embargo, the Big Three have relied on the steady cadence of truck sales to keep the coffers full. In an effort to reverse the paralyzing decline in sales last month, both Ford and Chrysler announced new discounts this fall on their newest trucks.
Chrysler LLC will offer a $2000 cash discount on the all-new 2009 Dodge Ram. The incentives seem to be working; the Ram's market share increased last month to nearly 16 percent from a low of 8.6 percent in May. Discounts vary by trim level and market; in Southern California, Dodge currently offers a $5000 incentive on the base model Ram 1500.
According to the Financial Times, Ford will offer a $2,500 incentive for every trade in for a 2009 F-150 pickup.
The new discounts come as a result of launching the two all-new trucks in a very difficult market. The downturn in home construction has pulled the rug out from underneath many contractors and builders, both of whom are core customers for large pickups. Discounts are usually a tool of last resort, used most often to clear dealer lots of outgoing models.
Since it's introduction in 1948, the Ford F-series pickup has become a sales legend. For 31 years, the F-series was Ford's best-selling vehicle; in 2007, sales of the F-series made up 27 percent of the automaker's annual sales volume. But as high oil prices sapped demand during the spring and worried lenders and faltering finances curtailed loans this summer, sales of the F-series have fallen sharply. Sales of the F-series were down 39 percent in September compared to a year ago.
Sales of the Dodge Ram were off by 28 percent for the same period, according to the Financial Times.
CSM Worldwide, a Michigan consultant firm, expects the US truck market to shrink next year and in 2010, bringing annual sales down to about 1.3 million units, about half of 2001’s peak.
Bond, Ollila step down from FoMoCo board
In other Ford news, the Financial Times reports that Sir John Bond and Jorma Ollila have stepped down from Ford Motor Company's board of directors. In a statement, Ford said that Bond, who had previously been head of HSBC, and Ollila, chairman of Nokia and Royal Dutch Shell, “believe they could not devote the additional time and international travel that would be required of them as the company responds to the unprecedented external environment and rapidly changing auto industry”.
Shares of Ford traded lower, down 4.12 percent to close at $2.33 per share.
Dodge is not publicly traded. Dodge is a subsidiary of Chrysler LLC, a privately held company controlled by equity management firm Cerberus Capital Management. The firm maintains a controlling stake in Chrysler's three brands: Chrysler, Jeep and Dodge.