Ford Says Fiesta Vital to Lineup Despite Sales Slump

Ford Motor Co. (F)’s Fiesta subcompact car will remain an important part of the automaker’s product line even after U.S. sales slid 25 percent this year, said Erich Merkle, Ford’s U.S. sales analyst.

Sales of the Fiesta, the smallest car in Ford’s lineup, have fallen as purchases of the compact Focus have risen 31 percent through July 31 in the U.S. Volatile gasoline prices will help sales of both models, Merkle said.

“The small-car segment, given its size, the largest in the industry, is large enough for two vehicles,” Merkle said yesterday in an interview in Washington. The Fiesta is the second-best selling vehicle globally for Ford, based in Dearborn, Michigan, after the Focus.

The company’s U.S. market share declined to 15.6 percent this year through July from 16.9 percent a year earlier as its 5.1 percent sales gain lagged the industry’s 14 percent increase, according to researcher Autodata Corp. Ford’s North American unit earned $2.01 billion in pretax operating profit last quarter while the company lost money in Europe and other markets.

Ford’s F-series pickups will post a sales increase this year despite last month’s 0.4 percent gain from a year earlier, Merkle said. Pickup truck sales normally increase in the second half of the year, he said. F-Series sales rose 12 percent in the first seven months.

Source: Ford Motor Co.

The 2013 Ford Motor Inc. Fiesta. Close

The 2013 Ford Motor Inc. Fiesta.

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Source: Ford Motor Co.

The 2013 Ford Motor Inc. Fiesta.

An improvement in the housing industry would help those sales along, he said. New U.S. home construction rose to the highest level in almost four years in June. Housing starts rose 6.9 percent that month to an annual pace of 760,000, according to the Commerce Department.

Ford, the second-largest U.S. automaker, sees U.S. vehicle sales on pace for the low end of its forecast of 14.5 million to 15 million vehicles this year, Merkle said. The figures include medium- and heavy-duty trucks. Confidence among U.S. consumers rose in July following four months of declines, the Conference Board’s index showed.

Ford shares rose 0.5 percent to $9.40 at the close in New York. The shares have fallen 13 percent this year.

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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