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A Silver Lining for Ford

It's no secret that American auto manufacturers are in tough shape. Ford's third quarter losses totaled $5.8 billion — about 30 times what they were a year ago.

But the Internal Revenue Service had some good news for Ford this week: the 2005 Ford Escape Hybrid has been certified for the Alternative Motor Vehicle Credit.

The Energy Policy Act of 2005 made thousands of dollars in tax credits available for people who purchase a hybrid vehicle from a list of IRS certified cars and trucks. Honda and Toyota dominated the list from the beginning, but American makes such as Ford, GMC, and Chevrolet are slowly finding their way on.

The 2006 Escape Hybrid was certified earlier this year, but this week's announcement should help sell some of the unsold 2005 models piling up in dealership lots. People who buy the Ford SUV will be eligible for the largest alternative vehicle tax credit to date: $2,600 for the 2WD model and $1,950 for the 4WD model.

Will it make any impact for the struggling automotive giant? Or is this a meager reminder that the company should have started focusing on fuel efficiency back when its Asian competitors did?

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