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

U.S. auto sales drop 37% to another low
Chrissie Thompson Automotive News February 3, 2009 - 12:20 pm ET UPDATED: 2/3/09 7:00 p.m. ET
U.S. auto sales dropped 37.1 percent in January, dragged down by the
Detroit 3, as the industry posted its lowest monthly total in 27 years.
Ford Motor Co.'s 41.6 percent fall and General Motors' 49 percent drop were steeper than analysts' forecasts. Chrysler tumbled more than 50 percent for the second straight month. Honda, Nissan and Toyota all slipped more than 27 percent, cementing the industry's fourth straight monthly slide of more than 30 percent.
The annual selling rate of 9.8 million units matched a rate last seen in August 1982. The sales total of 656,881 vehicles was the lowest since December 1981 and marked the 15th-straight monthly decline. The credit crunch is stifling sales, said John Broderick, general manager of Burlington Automotive's Chevrolet store in Burlington, N.J.
"Financing is very difficult. It's the toughest I've ever seen," he said.
Last autumn, GMAC Financial Services effectively stopped consumer lending, requiring credit applicants to have prime credit scores. The GM-exclusive lender loosened restrictions in December, but said today it financed just 5,000 purchases in January. Only one of those deals was from Broderick's store.
GM today responded by initiating a round of incentives that includes 0 percent financing and higher rebates. The program covers some of GM's best-selling vehicles, including the Chevrolet Malibu. Hyundai, Subaru gain
Only two companies gained: Hyundai-Kia and Subaru. Each saw sales rise about 8 percent. Subaru was the only automaker to record an increase in U.S. sales last year.
Hyundai brand sales rose 12.5 percent after the debut of the Hyundai Assurance Program Jan. 2. The plan allows customers who lose their jobs within a year of their purchase to return their new vehicles at no cost if they've made two payments.
"Buyers are very loyal to the Asian brands, but they're also very price sensitive, and they might be considering Hyundai or Kia over Toyota or Honda," said Jesse Toprak, executive director of industry analysis for auto information site Edmunds.com.
The industry's January results reinforce projections that any recovery won't happen before midyear. The also heighten the challenges for GM and Chrysler.
The two companies are preparing viability plans for the U.S. Treasury Department in order to preserve the $13.4 billion in federal loans they have already received.
Ford is trying to continue operations without federal aid, despite burning through $5.5 billion in cash last quarter.
Last year's light-vehicle sales dropped to 13.2 million, as soaring fuel prices in the first part of the year and a global credit crunch later in the year deepened a national recession. The annual sales rate peaked at 15.6 million in January and skidded to 10.4 million in December.
In 2007, 16.1 million light vehicles were sold in the United States.
Fleet factor
The biggest reasons for the decline in last month's sales rate was the fleet market, said Ford sales analyst George Pipas. "We estimate the industry fleet sales were down 65 or more percent from a year ago."
Ford said its sales to individual customers fell 27 percent. The two-thirds drop in fleet includes a 90 percent decline in sales to rental companies.
Ford's re-engineered F-150 pickup gained retail market share in January, the automaker said. But total F-series sales fell 38.6 percent in January.
January fleet sales fell partly because of U.S. automakers' extended plant shutdowns after the year-end holidays, analysts say. In addition, some corporations took advantage of GM's December fleet incentives. The industry started 2009 with a 94-day supply of vehicles, more than 50 percent above the level recommended by analysts.
Wary consumers crimped sales at Jim Arrigo's Dodge-Chrysler-Jeep store in West Palm Beach, Fla. Arrigo sold 160 new vehicles in January, down from 325 last year.
"They're not even sure if they'll have a job tomorrow,'' Arrigo said. "They're scared to death about buying something."
The Conference Board, a market information group, said last week its 42-year-old survey of consumer confidence slid to record lows in December and January.
Bob Carter, head of Toyota Division, said he doesn't anticipate any rebound in the market until the second half of the year.
"There were no surprises in January for the industry and the segments," he said. "The market turned out the way we anticipated."
Jamie LaReau, Amy Wilson and Kathy Jackson contributed to this report.
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<snip>
Damn, you beat Higgie to it. How'd you manage that?
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Hairy wrote:

Why bother? The Detroit 2.1 are dead men stumbling, why bother with a dead horse?
--
Civis Romanus Sum

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Toyota is not exactly setting the world on fire either. Toyota's US sales aer down almost as much as Fords (and worse if you don't count the deecline in fleet sales) and they aren't doing so well back in Japan either. Toyota's management blew billion on the Turdra monstrucity. Toyota's US plants are mostly just warehouses for employes -at least the ones that they have not sent home. They are delaying plans for new plants, etc., etc., etc.
Only Hyundai seems to have a clue....now that is a scary thought.
Ed
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Comparing Toyota to GM, Toyota is only in debt to it's ankles. Where as GM is in debt 2-3 times past their eyeballs. That sure leaves a lot of survival room. GM bleads about as much cash in 2 weeks as Toyota bleads in a year, and Toyota is already ahead of GM in fixing this. GM is like the whiney pig that thought he would never see a rainy day, then wants taxpayer bailouts due to shear stupidity and ignorance. The GM pig needs chapter 11.
Feburary 17th is coming up pretty quick, for those following, a magical date where GM has to present a viable recovery plan to a no BS president. Better be good boy, better be real good or you can kiss your jobs goodbye. My guess is sooner or later the recovery plan will include a "packaged" chapter 11.
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You seem to take great delight in the prospect of people losing their jobs. You are one creepy son of a bitch.
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wrote ...

Not really. But it has been a long time coming and the idiots that can control it are looking at the freight train coming at them like stunned deer not doing anything meaningful to avoid it. But at the last minute when firings occur, whine and pick taxpayers pockets like magots on a carcas. They collectively made their problems my problem, so don't expect any sympathy. Just want them out of my pockets. _ /'_/) ,/_ / / / /'_'/' '/'__'7, /'/ / / /" /_\ ('( ' /' ') \ / '' _.7' \ ( \ \ GM, Chrysler-Cerberus, CAW-UAW, get your selfish greedy hands out of our pockets! We don't steal from you!
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One thing you can be thankful for is that the Jap companies, assembling vehicle in the US, will not get US taxpayer money, even though they too are loosing sales in their biggest market and losing money world wide as well.
It will be the Japanese government and the Jap taxpayers who will need to up the amount of the subsidy they have been giving ALL of their manufactures since WWII. ;)
wrote ...

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wrote ...

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You are the hypocrite. You seem to think it is fine for the Japanese government to support Toyota and the other Japanese companies, but the US and Canada can't support there's.

You need to stop saying this. GM denied the Canadian governments offer for a loan.
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"80 Knight" <nospam> wrote in message

Why? If the Japanese wish to subsidize Can/US consumers let them. It's just as stupid as us subsidizing our own manufacturers. Except for one major difference. Their taxpayers support us. It doesn't come out of our pockets.
I don't see any hypocracy.

There shouldn't even be a discussion of gov't loans. That's what banks are for. Gov'ts are not supposed to be in the business of lending. Especially as lenders of last resort. That's enough to tell you that the borrower is not credit worthy.

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

Well put.
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That's your style(if you have any). You beat every horse till it's dead. But it's nice to know we won't be hearing from you any more.
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Hairy wrote:

I'll make a special effort to irritate a blowhard like you.
--
Civis Romanus Sum

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