FORD'S RETAIL DOWN 15% IN SEPTEMBER

While the Ford spinmeisters put their best face on it, Ford Motor Company's (F) September 2007 sales results were simply dismal. They put the "F" in F, so to speak.

Ford's PR Department blamed the housing credit crunch and a 62 percent cut in daily rental sales for a 21 percent overall sales decline.

They also trumpeted the minor strength of the crossover utility vehicle niche. In September, Ford Edge sold 11,632 units and Lincoln MKX climbed to 3,805, which were both nameplate records. Ford Escape sales were up 10 percent to 11,632. Mercury Mariner sales climbed 4 percent to a minuscule 2,699 units.

F Series Super Duty sales are such a disappointment (notwithstanding the minor restyling and the new twin-turbo PowerStroke engine) that the Automotive News is reporting Ford will shut down production for a couple of weeks beginning October 8. Meanwhile, the United Auto Workers and critical PowerStroke engine supplier International continue to haggle over a new contract (meaning a strike isn't out of the question). Obviously, if the UAW and International disrupt production for any length of time in the future, Super Duty supplies could be adversely affected.

The real trouble in September's numbers is further down the sales chart.

1. The "new" Taurus is an unqualified flop. With only 3,562 units moved in September, as compared to 6,054 underpowered Five Hundred sales in September 2006, it is clear that the market simply is not responding to the name change, new three-bar grille, the mid-pack 3.5 V6, and the "safest car" ad campaign.

2. The restyled Focus also is capturing fewer buyers, with sales off a massive 30 percent for September (9,885 units compared to 14,160 a year ago) and a blistering 5.5 percent decline for the year. Obviously, FoMoCo's failure to keep the Focus fresh and competitive continues to pay out in sales reductions and market share loss. Ford simply must achieve more diversity in its small car lineup and must meet or exceed the de facto industry standard four-year redesign cycle established by the Japanese.

3. The real heartbreaker is the Mustang. Down 28.4 percent for the month (10,266 units, compared to 14,341 last September) and a startling 17.6 percent for the year (109,803 compared to 133,269 in 2006), FoMoCo is simply not supplying the pony cars America wants at a price it can afford.

The problems are legion. Not enough styling updates . . . No small engine "tuner" model . . . too much dealer gouging on the Shelby GT500 . . . no high M.P.G. "green" model . . . not enough "bang for the buck" for the Mustang GT or the grossly overpriced Shelby GT.

The Mustang platform is simply too good to let it languish without a more diverse and targeted model lineup. Moreover, FoMoCo obviously needs to serve BOTH the retro and modern-style niches with the Mustang platform. Keeping the car purely retro and mostly unchanged for years at a time is hurting sales and unnecessarily graying the customer base.

Of course, the dismal results have prompted the American Family Association to assert partial credit:

"Ford Motor Company sales dropped 21% in September compared to that month's sales a year ago. Ford sales have dropped in 17 of the 19 months since AFA began a boycott of the company. AFA began boycotting Ford in March 2006 when the company reneged on a pledge to stop supporting homosexual organizations and same-sex marriage."

While it is impossible to determine whether or not the AFA boycott has reduced FoMoCo sales a percent or two, it certainly has not helped.

The real problems are product and perception.

Although industry juggernaut Toyota was off a few percent for September, many of the other Japanese brands continued to climb on the strength of redesigned products. And even General Motors(GM)--hampered by a two-day strike and a similar truck/SUV heavy sales mix-- managed to eke out a tiny sales gain on the surprising demand for their new truck line (if not GM's continued "Sell on Monday" dominance in NASCAR).

Well-targeted and marketed NEW cars sell. Stale, overpriced products (Mustang) and tepid reheats (Focus and the "new" Taurus) flounder. Hopefully Alan Mulally's Glass House Gang is finally getting this message.