Mustang feels Ford woes
Sporty autos don't account for large percentage of the market, but that doesn't stop carmakers from trying to appeal to buyers with the latest--or most classic--car designs


By Rick Popely and Jim Mateja
Tribune staff reporters
Published March 10, 2007


For an automaker that has had few bright spots recently, it's vexing to have a star dim.

But that has happened at Ford Motor Co., where sales are off 16 percent this year. And sales of its fabled Mustang have dropped 19 percent. It has nearly offset the 25 percent gain for up-and-coming Fusion.

Mustang's allure as a brand isn't the issue.

Vehicles age quickly as more than 35 brands introduce fresh models in a non-stop cycle. This is even more the case in the sporty segment.

Cars such as the Mustang traditionally have short shelf lives because they sell largely on styling and image. Buyers gravitate to the newest and sexiest models.

J.D. Power and Associates says the sporty car segment in which Mustang competes accounted for 3 percent of vehicle sales in 2006.

It's a niche market whose vehicles usually have small or no back seats and modest cargo space, making them impractical for the masses.

"There's nothing wrong with Mustang," said Ford sales analyst George Pipas, noting that the sporty segment as a whole is down 38 percent.

"When we reported our sales for February I said the decline in Mustang sales got our attention. Now that I see the results for the rest of the segment, I'm not sure it's a problem with the car as it is a problem with the weather."

Still, Ford may boost incentives on the car. It is offering a $1,000 rebate through April 2 and interest rates as low as 2.9 percent for 36 months on V-6 models, the same as last month.

The reason? The niche is about to grow.

Ford introduced the current version in 2004, and as it heads into the second half of a five-year product cycle and the two-year witching hour for sport coupes, General Motors will resurrect Chevrolet Camaro in late 2008, and Chrysler Group will revive the Dodge Challenger.

Pipas said Ford is well aware how fickle the market is for sporty cars like the Mustang.

"The attraction for sports coupes usually only lasts a couple years. It's a very style-conscious segment," he said.

Ask Nissan. The 350Z sold 36,728 in 2003, its first full year on the market, but has steadily slid to 24,635 last year.

Ford plans to combat that by bringing out new Mustang versions annually to generate showroom buzz.

This year, it's the Shelby GT 500; next year it's the Bullitt edition, named for the 1968 Steve McQueen movie that featured a Mustang in a famous chase scene. After that comes the Boss, another blast from the past.

Calumet City Ford dealer Joe Hennessy says that's the way to go. While this will be the second time around for Bullitt, Hennessy said: "It was a sellout the first time, and there's no reason to think it won't be again."

"Rest assured the next-generation Mustang is not far behind," Pipas added. Ford has not said when a new Mustang will arrive, but it most likely will be for the 2010 model year.

John Wolkonowicz, an analyst with industry forecaster Global Insight, knows that sporty cars can fade fast, but he agrees that Mustang is different because of its storied history and appeal to young buyers as well as Baby Boomers.

"Its styling is truly timeless and has the right proportions. There's nothing else like it on the road. Everyone instantly recognizes what it is," he said.

Camaro and Challenger could hurt Mustang sales, but Wolkonowicz said: "Owners are fiercely brand loyal to those cars, so they won't steal sales as much as you might think."

Besides, Ford will roll out a fresh Mustang a year after Camaro arrives, so Chevrolet won't have the newest hardware on the stree