Bronco SUVs in production at Ford’s Michigan Assembly plant, June 14, 2021.
Michael Wayland | CNBC
DETROIT — Ford Motor‘s U.S. vehicle sales showed positive signs of recovery from an ongoing shortage of semiconductor chips that’s wreaked havoc on the global automotive industry this year.
The Detroit automaker on Wednesday reported sales of 175,918 new vehicles in October, down by 4% from a year ago but a far narrower loss than in prior months. The sales mark Ford’s best sales by volume since April and the first time since May that the company hasn’t reported a double-digit monthly loss compared with 2020.
“Through June of this year, Ford retail sales were up 10.7%. With constrained inventories and record turn rates in the second quarter, we have been working closely with our dealers gathering retail orders, which are up 16-fold over last year,” said Andrew Frick, Ford vice president of U.S. and Canada sales.
In another positive note, Ford said vehicle inventories, which have been at record lows due to the chip shortage, increased by 7,000 units from a month earlier to 243,000 cars and trucks.
Ford’s sales last month outpaced the industry, according to Cox Automotive. The auto research company on Wednesday estimated new U.S. vehicle sales were down by about 21% compared with October 2020. That’s better than Cox’s initial forecast of a 30% decline.
“The market is still experiencing very low inventory and correspondingly low incentives, but the worst is likely behind us,” Cox said in a release.
Ford’s October sales come a week after the company nearly doubled Wall Street’s earnings expectations for the third quarter and raised its full-year adjusted earnings guidance to between $10.5 billion and $11.5 billion, up from between $9 billion and $10 billion.
However, Ford isn’t in the clear regarding its supply of semiconductor chips just yet. CFO John Lawler last week said the company expects the chip shortage to continue into next year and potentially, to a far lesser extent, into 2023.
Lawler said Ford expects a 10% increase in wholesale vehicle volumes in 2022 compared with this year, as the semiconductor shortage continues to impact the business.