By now everyone has heard of the Cash For Clunkers program by the US Government.  It's the program where the government (see tax payers dollars) gives large incentives to consumers looking to buy a new fuel efficient vehicle.  It breaks down by allowing a higher dollar amount, up to a max of $4,500, for buying a vehicle that gets over 10 more mpg than the vehicle you are trading in.

It's a program that has proved very successful on paper, so much so they have even extended the program by an additional $2 billion.  However, such a program can't last forever, which got me asking a few questions.

First question, will future buyers be waiting around for government assistance before they buy their next vehicle?  That is to say, once this incentive ends will the sales dry up until the next government intervention or will dealerships be capable of staying afloat on their own?  I'm on the mind that sales will again tank, more dealerships will close, and consumers will hold on to their money again until the next incentive.

Similar consumer buying habits changed back in the mid 90's when 0% financing was first introduced.  It created a flux of buyers looking to capitalize.  However, once dealerships tried to end the special promotion the sales ended as well.  Just to keep the status quo, dealerships have had to continue that special promotion to some extent to maintain sales.  Are we going down this road again?

So Ford posts a $2.3 billion dollar profit today for the 2nd quarter of 2009 and already the official industry experts are chiming in.  I already have  a view point on why Ford managed to get in the black for the second quarter and it has nothing to do with vehicle offerings.  That's right, I don't think hybrids and fuel economy had anything to do with the recent numbers published by Ford.

In my opinion Ford manged to turn $2.3 billion in profit because they received the support of the American consumer.  The regular Joe blows saw that this corporation was not taking a hand out and decided to show their support through their wallets.  The American consumer, when faced with countless options on car lots, decided to choose a Ford vehicle over GM, Chrysler, or Toyota.  It's a sign that the majority of Americans don't support the bail out plans in Washington.

Another driving force in sales will be whether or not the vehicle you buy now will be supported 5 or more years from now.  If you have a major component go out on your car after the warranty has expired, will parts be radically expensive, or supported by the manufacturer.  Vehicles that are discontinued generally see higher replacement parts in generic and OEM form, why put yourself in that kind of a position.

I thoroughly realize that $2.3 billion in profits is a far cry from where a company this size needs to be, especially to keep the stock holders happy.  However, in this economic environment every ray of sunshine helps to swallow the negative news around every corner.  It's a move in the right direction and I hope Ford can prove themselves again next quarter and the American people continue to voice their opinions with their wallets.

World markets are a tricky thing and staying in the customers good graces can be a balancing act.  That's why, at least vocally, Toyota hopes that GM will succeed and are constantly sending good wishes their way.  But why would a competitor, in a ever growing cut-throat market, want it's biggest competitor to succeed?

Let's look at history, even a few short decades ago.  In the 80's and before there was huge hatred toward the foreign market.  The perceived quality of foreign vehicles had not yet been established, so Toyota like other brands were just trying to prove themselves.  Another challenge they were trying to overcome was the general publics patriotism, the hope, and want for an American company to dominate the industry.

How far have we come?  Obviously Toyota took over GM as the largest car manufacturer in the world, owed largely to it's ever increasing US market share.  So what does Toyota risk, if they don't actively support it's domestic competitors?  In a sensitive market, walking on egg shells may be the only thing that keeps Toyota from slipping back into the early 80's in the eyes of American car buyers.

Consider the devastation to Toyota domestically if the American people decide to rally against foreign competitors and strongly support their domestic car manufacturers again.  Potentially, all the work Toyota had done to generate brand quality would be destroyed.  I'm not saying it's a bad thing, but there is a reason the owl wants the rabbits to mate.

I've yet to see one flying car, but that doesn't mean advancements in the automotive industry can still have the flavor of science fiction.  For example, today Ford announced that they will be releasing 2 different models of Lincoln's that are capable of parking themselves.  The target audience for the Lincoln model cars will no doubt appreciate the ability of a self parking vehicle, saving scratches and the lives of small animals everywhere.

The self parking mechanism and technology being developed by Ford will focus on parrallel parking.  This leap in auto technology will be featured of the Lincoln model MKS Sedan and MKT crossover.  This new advancement will be demod at the North American International Auto Show, for a sneak peak of what 2009 will bring, check out the Ford booth.

In other auto show news, Ford plans on debuting their hybrid Ford Fusion, which is capable of producing 41 miles per gallon.  Yes, 41, which is exactly 8 more mpg than the nearest competitor Toyota Camry hybrid.  Domestic vehicles will be stepping up their focus on technology and economy for 09, showing the foreign group that they still have some tricks up their sleeves, at least Ford does.

It's a big number and it's shaking things up in regards to what Ford is planning on pushing off the assembly line.  Ford just announced that it took a quarterly loss of $8.7 billion, citing a big ass drop in truck sales and leases.

Therefore Ford is planning on ramping up production of it's more fuel efficient lines of autos, like the Focus and Fiesta.  Furthermore they have plans of doubling their hybrid vehicles and bring more European cars to the US market, where we are finally catching up to the high price of fuel.  I'm just curious how trailers are going to be pulled by a 1.5 litre 4 banger and no matter what, there is no replacement for a truck bed when helping a friend move.

Good luck to Ford in turning over some profits next quarter.  As of now Ford is the 3rd largest auto manufacturer in the world, on the heels and/or coat tails of GM and Toyota.