Ford has fluffed up its “sales” numbers by temporarily giving away vehicles to people who don’t understand there’s no such thing as a free lunch.
Or maybe they do.
It is called “Zero, Zero, Zero” – as in zero down, zero percent interest and zero payments . . . for 90 days as regards the latter. After 90 days, the payments come due and while there may not be any interest on the loan, the loan is still based on the sales price of the vehicle – and that’s at the point now that a large and guaranteed-to-grow percentage of “buyers” fail to make them.
You may have read about the stat that about 20 percent of all new vehicle loans cost more than $1,000 per month and that those payments extend to seven years or even longer because if they didn’t, they payments would be even higher.
This is – obviously – unsustainable.
Reason it out, as Spock once said. The median income in this country is about $44,000. The average household (two earner) income is about $87,000. That is pre-tax as well as pre-food, pre-rent/mortgage and pre-forced insurance “coverage.” How much is left after that? Well, let’s do some rough math. Assume an “affordable” monthly mortgage/rent payment of $2,000 and there goes $24,000 or about half of the earnings (pre-tax) of the median income earner. Now deduct another $500 per month for groceries, which comes to $6,000 more (or less, actually) annually.
Without even considering federal/state income taxes, the median earner is essentially broke at this point. The average household is pinched. There are certainly affluent earners who make well over six figures but there are not enough of them to sustain mass-market sales, by definition. More finely, mass-market sales of luxury-priced vehicles – which is really what we’re talking about. Average, nothing-special crossovers typically cost close to $30,000 now and that’s on the low-end, for a small one that’s barely viable as a family vehicle. The least expensive trucks you’re allowed to buy in this country – models such as the Ford Ranger, Chevy Colorado and Toyota Tacoma – all start well into the $30k range and if you are wanting a full-sized truck, the starting price for a “base” trim is typically in the low $40k range.
The math, as the saying goes, doesn’t add up.
That doesn’t mean lots of people won’t “buy” a new Ford. They just won’t pay for them. Who could resist? Under the terms, you get to drive a brand-new Ford for three months without having to spend anything. Nothing down. No expectation of payment for 90 days. Huzzah! After the 90 days are up, a letter will of course come in the mail but that can be ignored for awhile. It’ll take another several months for the repo man to show up; maybe longer. In the meanwhile, you’ll have had use of the vehicle and no skin off your back – other than the ding on your credit report but who cares about that anymore? They’ll be happy to write you another loan again for whatever you want in another few moths from now. That’s how the system works. So long as the product gets moved, it doesn’t really matter whether anyone pays for it – because we all will eventually.
“Summer is peak driving season,” says Rob Kaffl, who is Ford’s director of U.S. sales and dealer relations. “Families are on the move, students are preparing for the fall, and small-business owners are gearing up for a strong second half. A lower upfront cost lets them get into the vehicle they need today instead of waiting.”
Waiting? What’s that? Who ever thinks about waiting?
When the mass defaults begin, though, Look Out! as OJ used to say.
Which they will because Zero, Zero, Zero aside the cost of the vehicle isn’t zero and when that first $1,000 per month payment comes due many won’t be able or willing to pay.
The same thing that happened to Mitsubishi a few years ago is likely to happen to Ford. What happened to Mitsubishi – back in the early 2000s – was that lots of people drove home new Mitsubishis they didn’t have to put anything down on or make any payments on – for a whole year! The problem – for Mitsubishi – was that many of those people never made a payment. 
Ford may encounter the same trouble for similar and different reasons. The similar one being that when you give things away for free, don’t expect people to pay for them. As Wimpy used to say: “I will gladly pay you Tuesday for a hamburger today.” Of course, people don’t watch Popeye anymore and so don’t get it that Wimpy isn’t going to pay for the hamburger, ever.
That was the gag.
But it’s also something more than that. Back in the early 2000s, people – most people – could afford to buy a Mitsubishi. Mitsubishi’s mistake was attracting the kind of clientele that avoids paying for things. Today, it’s a case of people not being able to pay for things. It’s a relevant distinction. 
The two least expensive new Fords – the Escape and the Maverick – both start just shy of $30,000. (Some will remember when Ford promised the Maverick would start just under $20k; few were actually sold at that dangled price.) The rest of the roster starts closer to $40k and that includes the least expensive version of the F-150 pickup.
Oh, and the Maverick is exempted from the offer. 
Do the math (again) and ask how many median income/average households can make payments on that while also making payments to the government (taxes) and the insurance mafia (a kind of private tax the government forces people to pay) and then the mortgage/rent payment, plus the phone, food and utilities bills.
Zero, Zero, Zero has fluffed up Ford’s “sales” numbers, alright. But other numbers may be tallied up later this year, when the repos begin.
In the meanwhile, why not enjoy a new ride for awhile?
. . .
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120 month auto loans, 50-year mortgages here we come!
I predict some reasonably priced, “lightly used” vehicles for sale in the next year, that this will end up biting into the sales of those models. Who wants a breathalyzer anyway when you can have a 25′? The rub will be that there’s no distinguishable difference and they are one update away from not being allowed to drive the damn thing!
“In the meanwhile, why not enjoy a new ride for awhile?”
Don’t forget “Ford Employee Pricing”. Letz see how GMC and Chrysler counter. Let the price wars begin.
You can watch documentaries of automobile manufacturing on YouTube all day long. From Henry Ford and how he left the farm for Detroit, his failures, his success can’t be denied.
Then onto more companies manufacturing cars, the facts presented in the documentaries, 23 million Volkswagen Beetles were manufactured in Germany. How crankshafts are inspected and balanced at the factory, all kinds of information in car documentaries.
It’s not hard to discover that people want transportation and cars can fill the void. People know what they want when it comes to getting there, legs work, wheels roll and is what counts the most-est.
There is demand, or was, difficult to say what the market is now.
All worth watching, you learn much more than what you knew before.
This dude channeled Eric. Video entitled “Something is Broken in the Automotive Industry.
https://www.youtube.com/watch?v=cREDsEsbAPo
I like this, MH! Maybe we’re beginning to get through to them…
Off topic, Wokewagan dealership here in Bridgewater NS still has three buzz vans on the lot. They keep moving them around as they have to be charged on occasion. Amazingly enough my f-150 can sit for weeks and I don’t have to add fuel. They could offer it to me for free and I would pass.
Was returning home last night from Kentville on the number 10 hwy. , going 110kph and got passed in the dark by an atv and not a side by side I was in tears laughing…..rednecks going to redneck. Speed”limit” 90kph
Hi Nova,
True story in re the ID Buzz. I was supposed ti get one this week but it had a “gitch” and so they sent me a Mazda CX50 instead!
My neighgor bought a Buzz, and the van recently disappeared to service for a week with a problem serious enough to warrant a dealer loaner ID4.
Morning, Nova!
Yup. Same just happened to me. I was scheduled to get an ID Buzz press car to drive for a week but it got pulled on account of a “glitch.” VW is doomed, I think.
Here’s the kicker about this program, anything Ford makes that people actually want to buy is excluded from this sales promotion. Rangers, Mustangs, Raptors, and more all excluded. It’s a nonsense promotion once all the excluded models are considered. It’s just to get people to come into the dealerships and find out what they want to buy isn’t part of the promotion.
I’ve been fooled many times by this sort of marketing.
Some history to ponder: not long after the Federal Reserve was created in 1913 and right after WW1, Midwest banks were flush with money. This was because of Britain and France buying American agriculture products for food, leather, steel and clothing for the war effort. The NY Banks were jealous of their flush accounts that bypassed New York and directly deposited in the Midwest. So, the NY Fed started providing ease credit at low rates to Midwest banks starting in 1919. The banks took up the cheap credit and lent it to the farmers and industry at a nice profit. These short-term loans were callable. In 1920 the NY Fed member banks all called in the loans at the same time. Since the banks could not obtain alternative financing on short notice they folded, and their assets became property of the NY Fed members. Farmers and industry were foreclosed upon which were collateral damage, but the banks got what they wanted. This was a recession from 1920-22. Prior to 1920 there were many motorcycle companies in business. After 1920 Harley Davidson, Indian and Henderson were alive (barely). Those family farms who took the easy money from the banks were decimated.
As for Ford and GM offering ease terms: beware of the naked man who offers you his shirt.
Might explain the Wall Street Bombing on September 16, 1920.
Looks somewhat suspicious.
The fed was created closer to the start of WW1 than end of it. But it certainly financed the US entry into the war. The consequences of which we are still suffering.
And to date, Mitsubishi has never recovered.
I’m actually encouraged by the apparent economic downturn. It’s been a long time coming. Looking forward to a market correction on many levels. I just hope the fed doesn’t step in too early and fuck things up (as it usually does).
I think the plan is to cause a downturn for the midterm elections in 2026. I expect a slow downward trend (with some foreshadowing along the way) followed by a huge collapse next summer (blamed on Trump and MAGA to benefit the Democrats). Ford could be part of that collapse.
You might recall that in the last severe downturn in 2008, crude oil hit its record high of $147 per barrel on July 11, exactly 17 years ago. That was eight months into the recession which began in December 2007. Commodity price spikes during recession are not unusual.
This time round, copper is spiking into developing economic weakness. Check the chart:
https://tinyurl.com/yhm88526
Trump said Tuesday he’s imposing a 50 percent tariff on copper. Copper futures soared 17 percent – the highest rise during a day since 1988 – before coming down. Americlowns now pay 138 percent over the global benchmark, CNBC reported.
The Lügenpresse tends to focus on higher prices for US consumers. But how are US manufacturers going to compete internationally, when they are trapped in a Trump-imposed bubble of artificially-jacked copper prices?
Way to go, Donnie Fubar. You just shot our own damned feet off.
The correct spelling is terror-iffs.
5.62 USD for a pound of copper today.
562 pennies.
562 copper pennies will weigh, 562×3.11=1747 grams, metrics work too.
454 grams to equal 16 ounces, one pound, 1747/454=3.84 pounds.
150×3.11=467 grams. one pound of copper pennies is equal to 5.62 USD in 2025 dollars.
150 pennies are now worth 5.62 per pound, you’ll need 562 pennies to equal 150 copper pennies ca. 1982 or before.
In other words, 450 copper pennies are now worth almost 17 dollars in 2025 dollars.
What terror-iffs do do.
You are being robbed, again and again.
There actually was a recession in the first half of 2022, if you go by the definition of a recession as
two or more consecutive quarters of negative economic growth. Yet none dared mention it.
‘Zero, Zero, Zero has fluffed up Ford’s “sales” numbers, alright.’ — eric
Eric examines this program from the buyer’s perspective. Zero, zero, zero also says a lot about seller desperation, and the economic backdrop.
Mitsubishi’s epic faceplant with such a program came at the end of the early 2000s recession, when consumer discretionary purchases (as always during economic weakness) were moribund.
Ford’s 2025 update tells us that wage earners are struggling; the economy is weak; and that the outcome of the Tariff King’s impulsive shotgun blasts into the dark, which won’t be known until August, can only inflict more damage on the new vehicle market.
Pity Ford, actually — who can run a large-scale, heavily-regulated business, when the regulators are under the orange thumb of America’s version of Nicolás Maduro?
Welcome to the Third World, comrades. It’s gonna be a bumpy ride.
Sadly the days when you could sell Chevettes and yugos were killed off by GovCo. The problem then becomes one of if almost no one can afford to buy what you are selling how long will you stay in business?
Looks like some folks have zero interest in buying a new car.
You will get nada, nothing, zip, zero.
Ford doesn’t know that they are manufacturing cars and trucks nobody wants anymore.
You do have to have shit for brains to buy into any of it.
Like Trump, fell for it all, hook, line and sinker. Trump needs a bottle in front of him and a frontal lobotomy.
Goes without saying and you know Trump has shit for brains. Plain as day.
Good bye, cruel world. har
Other than that, I will have no qualms about buying a brand new and improved 1965 Ford Fairlane, 2026 version.
Garret Motion (GTX) manufactures 50,000 turbos each day.
You now know where they come from.
You need to have a household income of $150-200k to do well in this country these days. My neighbor and his wife were public school teachers, making $100k each. Household income of $200k. Both retired at age 55 with a lifetime pension after 30 years.
They don’t buy cars or fix cars change oil like us stupid peasants. They lease cars and play golf. Still interesting to hear him bitch about the lease payments on his truck, though, plus college costs for his kids. So even if you have a $200k income you can burn right through it these days.
I actually got one of the $20k Mavericks a couple of years ago. Considered buying another one this year but the price went up SEVEN GRAND+ in two years, so I passed. I am gambling that if they do not sell enough of them at almost $30k they will have to offer rebates, but we’ll see. It may have been a dumb move on my part, though. If inflation keeps rip-roaring, the additional $7k that is still in my bank account instead of Ford’s might not be worth squat.
There’s still a lot of wealth tied up in the “war baby” generation, the pre-boomers. They got all the benefits of a massively growing postwar economy, the baby boom and early purchasing opportunities (such as buying homes priced at Brenton Woods dollars just before Nixon inflated their paychecks). Now they have to spend money in their retirement account or face big tax penalties. So they buy a new truck every 4 years, trading in the “old” model with no miles driven because that’s what they’re used to doing -the Malaise era trained them to not trust a car more than 3 years, especially in the northeast.
That’s Ford’s target buyer. And fleet sales.
When they don’t have to *pay* for the thing, they don’t *maintain* the thing, which is important in the era of turbo-ed everything that isn’t a hybrid.
Papi gets his big truck, though, and that’s what counts.
I think I’ll take them up on the offer…for a Mustang Darkhorse Premium with Tremec 6-speed manual.
Don’t bother to tag it or insure it. I’ll trailer it home. It’ll make a great track car for the rest of the year…no charge.
TIME ATTACK HERE WE COME!!!!!!
Shades of the Hertz Shelby Mustangs, I read about them coming back with roll bar mounts under the carpet. I like the way you think…
Mustangs are not included in the promotion. Mavericks, Rangers, and practically anything else anyone might want to buy are not included in the promotion.
OK, Brent, I’ll just have to run in the small bore fender class instead of big bore.
I can see the pushback firming up. People are getting the word around that all these new vehicles are junk. It is too hard to hide this fact.
Even the electric bicycles won’t rescue the home budget, as they have high cost and an even shorter lifespan. I am not sure where things go from here.