DETROIT, AUG. 6 -- Ford Motor Co. followed General Motors Corp.'s lead today by offering financing on car loans as low as 1.9 percent for 24 months, or cash allowances of up to $700 for most of its small and midsize cars.
The new plan, which analysts had expected would come almost immediately, covers 70 percent of Ford and Lincoln Mercury models. It started last night and runs through Sept. 30.
Despite "extremely strong demand for Ford and Mercury cars" and a relatively low average dealer inventory of 63 days, "We intend to continue responding to these programs because we want to keep our dealers competitive and maintain our strong sales momentum," said Louis Lataif, Ford's vice president of North American Sales Operations.
GM, which has been suffering from large inventories and slow sales, yesterday announced its lowest rates in company history, with 1.9 percent financing for 24 months or rebates of up to $1,000. The GM plan covers 90 percent of the company's cars and is scheduled to run through Sept. 30.
Though analysts thought that ultimately Ford and Chrysler Corp. would have to follow GM with their own programs, Chrysler has not announced a new program.