Re: U.S. auto sales drop 37% to another low



I little back-up - Ford's decline includes the the loss of Jaguar and Land Rover (they were counted in the 2008 totals, not counted in 2009). This inflates Ford decrease by about 3%. If you just look at Ford / Lincoln / Mercury sales, the decrease is about 39%.
Toyota did the worst of the Japanese companies with a 31.7% decline. Not sure why the article spelled out the Ford and GM declines, and then just said all the big Japanese companies declines by more than 27%. It seems like they should have highlighted them individually as well (Honda down 27.9%, Nissan down 29.7%).
......

I thought all the US companies were trying to eliminate "no-profit" fleet sales. It seems they were successful.

Not a big surprise.
Ed
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Honda stated last year that they were not concerned about competition from Detroit, but were concerned about the Chinese.
Imagine the chinese market, 1.6B people, growing middle class at about 400M starting to buy cars. One cannot help but to know China, while in it's infacy as an automaker is going to grow up real fast. And yes, Chinese have automakers we don't see on the sales charts yet. They will have volume and costs in their favor. Once their market is saturated, they will eye exports to the US and Canada.
I would say if a high cost north American automakers (any company) wants to survive they had better get well run and profitable very fast or else they will just be dead bugs caught in the wake. In the new economy, people are not going to pay 25, 30, 35, 40+ for a middle class automobile. Try $15K.
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Interesting you should mention the Chinese. I just saw a new article stating that for January, the world largest car market was China, NOT the US. And, GM actually does fairly well in China.....so maybe GM should just shut down the US operation and become CM.....
Ed
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That happens when you spend more than you earn as an economy. Part of this whole excercise is to reduce this effect, and China does not need more USD on deposit from trade, with over $1.5T in USD cash. Last year when China cashed some of the cash they had to buy resource companies, it caused the USD to drop.
While most people play up the costs of gasoline, much of it was due to the weak USD.
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Where do folks get the idea fleet sales are not profitable? Every manufacture, including import brands, sells to fleets. The industry fleet discount averages around $800 for all manufactures.
Plant shut downs makes sense as the reason for lost fleet sales. Fleets buy early on in the model year, not at the end of the model year.
A sale is a sale, why would any manufacture NOT want to sell to a buyer that buys in volume?

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Fleet sales are not "no profit" sales. They are at a lesser profit than consumer sales, but at a higher volume. Nothing unusual about that formula.
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-Mike-
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