Ford is expanding Fusion incentives to clear out inventories

Article by Anita Panait, on February 24, 2014

Ford Motor Co. is offering increased incentives on its Fusion sedan to help clear out the rising inventories. Ford is now offering the Fusion with zero-percent financing for 60 months plus $1,000 cash back. Ford is likewise offering leases with no money due at signing and no first payment; or discounts of up to $3,000 for buyers who refuse the financing and make a trade-in.

According to dealers and analysts, Ford’s latest offers are the most generous deals on the Fusion since the current generation was rolled out in 2012. "The car is selling, but not as fast as they're building them," said Larry Taylor, owner of Beau Townsend Ford in Vandalia, Ohio. "They've buried us."

Taylor remarked that he has sold only 17 units so far this month, and still has 90 on his lot. In addition, the dealership will receive 100 in the near future. Ford had a 97-day supply of the Fusion as of Feb. 1, up from 84 days as of Jan. 1, according to the Automotive News Data Center.

Fusion sales dropped 8 percent year-over-year in January, but still outsold the Honda Accord by 113 units. Sales of the Fusion as well as mid-sized cars have slumped in the past six months, coinciding with when the carmaker started output of the model at its Michigan site to ease inventory shortages.

The mid-sized car segment exceeded 200,000 units a month from February through August 2013, but has since failed to reach that figure each month.

Snowstorms and cold weather also slowed down sales in January, allowing inventories to grow. Ford's chief sales analyst Erich Merkle remarked that he is confident that Fusion inventories will drop as the weather warms up. He also remarked that Ford plans to be disciplined with incentives, yet "maintain a competitive position." He noted that despite the incentives, the Fusion still commands the segment's highest transaction prices.

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