For the fourth straight month in July, sales of Ford of Europe dropped as registrations were down 22.3% to 97,800 vehicles in Ford's main 19 European markets.
Ford has said that 2010 sales in Europe are expected to drop because of the expiration of scrapping incentives and because deep discounts will not be used so that volumes achieved in 2009 will be maintained.
In a statement last Friday, Ingvar Sviggum, Ford of Europe's vice president of marketing, sales and service, said that high discounts on new cars (as many of its rivals still offer) can lower the residual value of a vehicle. This implies a risk to the investment a customer made in the purchase of a new car.
Sviggum added that he believes that this unsustainable heavy discounting harms brand reputation and weakens the market further.
In some countries where the scrapping programs have ended (including Germany, Italy and the UK), some competitors have started offering discounts of 30% to 50%. Government-sponsored scrapping programs have led to a powerful surge in sales and production in the second half of 2009.
Carmakers have not been able to match the pace of the artificially inflated sales. Ford's data show that overall sales in its main 19 markets fell by 16% to 1,178,700 units.
In the first seven months of 2010, Ford registered 815,100 vehicles in its traditional 19 European markets, a 6.5% (or 57,000 units) decrease when compared to 2009 figures. Meanwhile, the overall sales in those markets fell by 1% to 9,460,000.