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Until nation's No. 2 automaker jazzes up lineup, it'll continue to lose significance -- and market share
Thursday, June 15, 2006

By Don Hammonds, Pittsburgh Post-Gazette

General Motors Corp. may be struggling, but as far as industry insiders are concerned, financially troubled Ford Motor Co.'s prospects are bleaker. And the reasons are as obvious as the new models on the showroom floor, which are for the most part dull and uninteresting. And those in the pipeline don't seem to be much better.

"I've thought Ford was in worse shape than GM for the last six months or so," said Jack Nerad of Kelley Blue Book. "A lot of us were looking at what we already have from Ford and what we know is coming from Ford, and we are less positive about what's coming up for them vs. what GM has been announcing."

The dissatisfaction with Ford's product offerings is part of the reason why Fitch Ratings last week downgraded the long-term debt ratings for Ford and its financing unit deeper into junk status. Further market share losses and cost increases also were factors. "There is little to point to in terms of a turnaround for Ford in North America through 2007,'' said Mark Oline, Fitch managing director.

A look at some of today's vehicle segments illustrates where Ford has problems. "Must have" or so-called "halo" cars and trucks -- products that are showroom traffic generators that add luster to the whole product lineup even if consumers end up buying a different model -- are sorely lacking.

By contrast, rival GM has several, including the Chevy Corvette, Pontiac Solstice and Saturn Sky roadsters. Corvettes have been regularly snapped up for decades, and the Solstice and Sky are sellouts with waiting lists. In fact, GM reportedly is looking for ways to increase plant capacity to build more.

Moreover, sales of Ford's only "must have" car, the Mustang, already have slowed a year after the latest make was introduced. In May, sales were down 21 percent from a year ago, and are down 11.6 percent so far this year when compared to the same period last year.

Things aren't likely to get any easier for Mustang in the next year or two, with Chevy expected to introduce its competing Camaro and Dodge, its Challenger. There is even speculation that Pontiac may bring back the Firebird.

In the heart of the market -- family sedans -- Ford also is struggling. It takes both of its main family sedan models, the full-size Five Hundred and its popular intermediate Fusion, to even come close to the sales of just one GM product, the full-size Chevy Impala.

According to J.D. Powers and Associates, Chevy's new Impala sold 23,702 units last month, vs. only 8,204 Five Hundreds, its direct competitor from Ford
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