DETROIT - Ford Motor Co. put its money where sales are weakest as it announced higher customer rebates on cars last week. Automotive News estimates that the new schedule could add $145 million to the company's car rebate payouts in the third quarter.
Ford's new incentives took effect Tuesday, July 8. They expire Oct. 1 and thus cover the 1997-model cleanup period.
Meanwhile, Chrysler Corp. was straddling the rebate fence. Most of its customer incentives expired July 7, and Chrysler simply renewed them for eight days. Its new list is expected this week.
In the first six months of this year, Ford Motor's car sales were down 8.3 percent from 1996.
In the new incentive schedule, Ford Motor doubled the customer rebate on the Ford Contour and Mercury Mystique, the Ford Thunderbird and Mercury Cougar, and the imported Ford Aspire. The current giveback is $1,000.
The rebate rose 50 percent - from $1,000 to $1,500 - on the Ford Taurus and Mercury Sable and the Ford Crown Victoria and Mercury Grand Marquis. Ford claims the Taurus rebate was hiked to $1,500 before July 8, but Ford made no public announcement of such action.
In recent years, an increase in the Taurus rebate would have been interpreted as an effort to keep Taurus in first place in car sales. This year, the Taurus is a distant second to the Toyota Camry, and the higher rebate appears to be a bid to move the metal off Ford dealers' lots.
The $1,500 rebate is not the highest ever for the Taurus. A Ford spokesman said the payout reached $2,000 in the 1995 and 1996 model years.
Ford also raised the rebate on the Ford Probe - from $800 to $1,000. The Probe, Aspire, Thunderbird and Cougar will be dropped for the 1998 model year.
Ford's first-half truck sales were up 4 percent, and the company boosted the rebate on only one of its truck lines. The Aerostar minivan climbed from $1,000 to $1,500. The Aerostar also will be dropped for 1998.
Last week was study time at Chrysler Corp. as the company pondered how to stimulate the summer/cleanup market. Two dealers, who asked that they not be named, said they expected Chrysler to sweeten the rebate pot, but stressed that they expect 'nothing dramatic.'
One said he expects the dealer incentives on the Jeep Cherokee and Grand Cherokee to rise to $1,000, from $500. The other said Chrysler is talking to dealers in designing its incentive package.
General Motors cleanup rebates have been in place since early April for Chevrolet, Pontiac, GMC and Oldsmobile. Buick is expected to disclose its program this week.
Special Correspondent Karalynn Ott contributed to this report.