Ford U.S. July Sales Rise 2.3% on Clunkers Program

By Mike Ramsey and Alex Ortolani

Aug. 3 (Bloomberg) -- Ford Motor Co. said July U.S. sales rose 2.3 percent, its first monthly gain since 2007, as the government’s so-called cash-for-clunkers incentive may have helped the auto industry to the strongest pace this year.

Deliveries including the Volvo brand increased to 165,279 cars and trucks from 161,530 a year earlier, the Dearborn, Michigan-based company said in a statement today.

Ford’s result may signal the start of a recovery for the industry. Analysts estimate that the annual pace exceeded 10 million for the first time this year. The government program, which offers as much as $4,500 for trading in older, less fuel- efficient vehicles, has run through the $1 billion available in about a week, and Congress is considering $2 billion more.

<SNIP> http://www.bloomberg.com/apps/news?pid=20601087&sid=aKMiOMD6g_2c

---

Before the celebration starts:
- how many people who would have bought earlier waited until the cash-forclunkers program started and did this artificially depress June sales?
- how many people who would have bought later this year, instead moved up their purchase to take advantage of the program?
Most likely, sales will fall dramatically again in September/October unless the government program is continued indefinitely.

The experience of the auto manufacturers with rebate programs was that the programs just caused customers to not buy vehicles unless there was a rebate program in effect.