With the June 1st deadline fast approaching, many people speculate that General Motors will be declaring bankruptcy. However, one rival company that stands to possibly profit from this decision is Ford, who has begun offering cash incentives to promote their auto sales. Even though Ford posted losses of 17 billion dollars last year, they have (so far) successfully restructured their current debt, cut production and renegotiated their union agreements. These decisions have positively impacted Ford’s market share price, with two quarters of consecutive gains.
With their strongest lineup prospected to be released over the next decade, Ford is quickly acquiring advantages with economically-squeezed consumers. Even with the financial state of the USA, Ford has posted two consecutive quarters with retail market share gains. This has promoted Ford to begin spending money on marketing and development. Though this could backfire (especially if the Auto Industry continues to lose money, and Ford ends up lobbying the Federal Reserve for loans), Ford believes that it is a smart marketing strategy even in current financial times.
In New York, an email was sent to Blue Oval dealerships, giving them the ability to give consumers $1000 in “conquest cash” if they trade in a Jeep, Chrysler, or Dodge vehicle toward certain Ford models. Since many people have been defecting to purchase Ford and Lincoln Mercury models since the beginning of the year, Ford hopes that this extra incentive will boost auto sales. Also, since this $1000 incentive is also combinable with 0% APR, Bonus Cash and Customer Cash, it provides a very aggressive marketing strategy for Ford.
It could be argued that Ford is taking advantage of the speculated bankruptcy of GM. However, it could be categorized simply as “smart marketing”. Ford is attempting to reap benefits even in these dire financial times, which is an incredibly bold move. Since Ford is currently better positioned than any previous time in the past 10 years to take a significant amount of the market share. It’s no secret that Beechmont Ford is doing it’s best to prepare for massive sales, many are expecting Cincinati Mustang sales are going to skyrocket this year, with the release of the new 2010 model.
