Ford Sales Slowest In 60 Years

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Ford Sales Slowest In 60 Years

September 5, 2013, 10:35 am Kochie's Business Builders Yahoo!7



If we needed any further confirmation the Australian auto industry is in strife, here it is. Ford sold fewer Falcons in August than at any time since its 1960 launch.

Ford’s sales slump led a wider contraction in the locally manufactured market, where sales fell 13% compared to the same month last year.

Car makers blame the fall on the Government’s decision to scrap the fringe benefits tax treatment of company cars, however even with this considered, it is a significant contraction for an industry heavily reliant on government subsidies and wage freezes for viability.

The Australian Automobile Dealers Association says that almost two thirds of new car dealers have made staff redundant, or plan to, as a result of the tax changes.

However given sales of foreign cars actually rose 1.7% last month, the impact of the tax as touted by Australian dealers and manufacturers appears somewhat exaggerated.


The Coalition plans to reverse the FBT decision if it is elected at this week’s Federal election, and urged people to start buying new cars if it wins.

Despite Tony Abbott’s cost cutting including $500 million in car subsidies, he and Treasurer Joe Hockey pledged to support local manufacturers in an open letter to car makers yesterday.

“We encourage all stakeholders, including employers and employees engaged in salary sacrifice programs, to urgently and immediately return to normal trading activity in order to repair the damage done [by FBT changes]”

However whether this reversal of policy is enough to arrest Ford’s slump is doubtful.

The trouble with the local industry, and Ford in particular, is the reluctance to change their product offerings to cater for the small, cheaper cars that have become so popular in recent years.

There were just 573 of Ford’s fuel heavy Falcon sold last month, a 58% fall that forced the local factory to halt production for a period.

Understandably, the company plans to cease manufacturing in Australia altogether.
http://au.smallbusiness.yahoo.com/ne...t-in-60-years/