Programs To Generate 3 Million Auto Sales In EuropBy Jeff Bennett
Of DOW JONES NEWSWIRES
DETROIT -(Dow Jones)- Ford Motor Co.'s (F) finance chief said about 3 million new vehicle sales will be generated in Europe due to the scrappage programs now being offered in a dozen different countries.
The programs, which offered rebates to consumers who traded in their old vehicle and bought new, have proven successful and sparked sales in a difficult market, Chief Financial Officer Lewis Booth said during an analyst conference call in London Friday.
Here in the U.S., the "Cash for Clunkers" program contributed to about 700,000 new vehicle sales as consumers surprised auto makers by swarming showrooms to buy. Ford has said that it is asking many European governments to continue offering the scrappage programs into 2010.
The Obama Administration hasn't said whether it will revive the "Cash for Clunkers" program, which ended last month after the government spent $3 billion.
Booth also said Ford has trimmed its total global work force to 201,000 people as of June 30, compared with 300,000 at the end of 2005.
He said the cost-cutting within Ford has helped the company slow its cash burn during the historic downturn in automotive sales and further moves are still needed. He declined to provide details.
"The company will survive this difficult period," Booth said.
Booth also declined to comment on the proposed sale of the auto maker's Volvo Cars unit. Speculation has intensified during the past week that Geely Group, one of China's main independent auto makers, is considering making a bid for the unit.
Booth said he was "puzzled" over GM's announced plans to sell a controlling stake in its European Opel division to a consortium led by Canadian parts maker Magna International Inc. (MGA).
"GM still continues to have too much manufacturing capacity in Europe," Booth said. "We are continuing to try and find ways to take more capacity out."
-By Jeff Bennett; jeff.bennett@dowjones.com; 248-204-5542
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