It's a first: Detroit 3 market share dips below 50%

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It's a first: Detroit 3 market share dips below 50% http://www.autonews.com/apps/pbcs.dll/article?AID=/20070801/REG/308010013/1078&refsect For U.S. automakers, July was the darkest month in the 102-year history
of the automobile business in the United States.
For the first time, foreign manufacturers controlled the market. The import-badged cars and trucks captured 51.9 percent of the market, leaving only 48.1 percent for the domestic brands of General Motors, Ford Motor Co. and the Chrysler group. A year ago, the domestics had 52.0 percent of the July market.
In raw numbers, the score was: Imports, 679,523; Detroit 3, 629,569. The domestic brands still hold the lead for the year to date. Seven-month market shares were 51.4 percent for the Detroit 3 domestics and 48.6 percent for the import-badged brands.
Still, sales weren't great for the imports, either. Auto sales wilted for just about everybody in July. For the month, total sales fell 12.4 percent.
Withered by high fuel prices and blistered by consumers strapped for cash because of rising mortgage rates, five of the big six automakers lost ground in July. Only Nissan eked out a small gain.
Not even Toyota Motor Sales U.S.A. Inc. and American Honda Motor Co., which seem to always prosper in good times and bad, could buck the July drought. Both jacked up their incentive spending, but suffered sales declines anyway.
As usual, the news was the worst for the Detroit 3:
* General Motors: down 22.3 percent * Ford Motor Co.: down 19.2 percent * the Chrysler group: down 8.4 percent
GM said it sold 315,870 vehicles in July, down from 406,298 in July 2006. Ford delivered 194,092 vehicles in July, compared with 240,104 last year. The Chrysler group sold 137,728 vehicles in July, down from 150,349 a year ago.
Toyota was off 3.5 percent from a year ago, while Honda's sales fell 3.2 percent. But the results might have been much worse had it not been for incentives, which were way up for both automakers in July.
"We are seeing combined incentive spending for Japanese automakers reach record highs," said Jesse Toprak, executive director for industry analysis for Edmunds.com, an industry research firm.
Record incentives
In July, Toyota's average incentive spending per vehicle totaled $1,492, up nearly 50 percent from July 2006. Honda, which typically shies away from cash payouts, spent an average of $1,146 per vehicle on incentives, up nearly 30 percent from a year ago. Nissan's July incentives of $2,290 per vehicle topped the Asian automakers but were down about 12 percent from a year ago.
Still, the Detroit 3 led the league in givebacks in July by a wide margin. The Chrysler group averaged $4,082 per vehicle, up from $2,623 a year ago. Ford's average of $2,984, was down sharply from $3,888 in July 2006 and was best among the Detroit 3. GM, with an average of $3,130, was down nearly 20 percent over a year ago.
Ford sales analyst George Pipas said declines in both daily rental fleet and retail sales contributed to the big drop.
"Obviously, the magnitude of the decline in July is fairly substantial," Pipas said.
He said softer industry sales are a concern, but Ford will stick with its plans rather than unilaterally lowering prices to spike consumer interest.
"Sometimes you just take your medicine and get on with it," Pipas said.
August doesn't look sunny
GM had almost no bright spots, and no indication that August will be any better than July. With the exception of the Saturn Aura, Pontiac Solstice and Cadillac DTS, sales of all of GM's car lines were down. For GM's bread-and-butter pickups, the Chevrolet Silverado fell 26.5 percent, and the GMC Sierra was off 28 percent.
Only GM's new trio of mid-sized crossovers, the Saturn Outlook, GMC Acadia and Buick Enclave, had any traction in July. Combined, the three stylish crossovers sold 12,080. The sales are encouraging for GM because the crossovers are moving off showroom floors despite low incentives, and production is just now ramping up.
Paul Ballew, GM's executive director of market and industry analysis, said, "We didn't have a terrific retail month for sure, but it's better than June."
Rethinking 2007 forecast
Ford said it will reassess its forecast for industry-wide U.S. sales in 2007, given the sharp drop in July sales. Ford's current industry forecast is at 16.8 million vehicles.
"We think something in this range is feasible in light of these consumer fundamentals and the overall pace of the economy," said Ellen Hughes-Cromwick, Ford's chief economist. "But we are certainly going to reassess this once we get the final data for the July sales."
Ballew said he expects the industry to end 2007 with sales of 16.6 million to 16.7 million vehicles. He said a weak housing market and high fuel prices would weigh on U.S. vehicle sales through the remainder of 2007 and into 2008.
"The twinfold headwinds of gas prices and housing are clearly having an impact on the business," Ballew said on a conference call with analysts and reporters.
Ballew said GM would be more aggressive on incentive spending over the remainder of the year, in response to heavy discounting from competitors, particularly on pickup trucks.
"We are not going to let the competition run that far down in front of us as they did in June," Ballew said. "They've been extremely aggressive ... and we can't allow competition to discount to that extent without evaluating some response," he said, referring to the pickup truck category.
As the incentive war heats up, Ballew said pickup sales would recover slightly through the rest of the year.
"We believe full-size pickups will show some recovery given the amount of emphasis from vehicle manufacturers," he said. Ballew also said he expected the industry challenges to impact the truck-based SUV and mid-size van segments the most.
Meanwhile, Toyota said consumer incentives on its new Tundra pickup truck in the United States would be lower this month.
The Japanese automaker declined to specify the exact rebate on the pickup truck, but said it was lower than reported.
Industry-tracking firm www.Edmunds.com estimates that the Tundra carries incentives worth $6,861 on average, the highest of any full-size pickup truck.
Sales of the revamped Tundra more than doubled in July from a year earlier.
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We long ago figured out that you delight in any bad news you can find about the US automakers Jim, but come on... do you really feel that strong of a need to post 4 articles that all say the same thing? Why don't you just take these articles into the privacy of your bedroom and get your jollies off reading them under your covers?
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Mike Marlow wrote:

Different site have slightly different takes.
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If you were head of GM, Mike, what would be your first move to try to reverse this business trend?
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Hard to say which would be my first move. Among the competing ideas would be the following:
- Take immediate steps to up quality. GM (not unlike other manufacturers), has too many lingering issues that are simple quality issues. In this area I believe I'd put more decision authority back into the hands of engineering and take that authority from the pens of bean counters. Not recklessly, but I do believe GM went too far in giving bean counters control over vehicle design.
- Cut the bleed. I'd drop some products and bolster others. I'd quit throwing the car of the week on the table, from Australia, etc. and concentrate on dropping lines that are redundant, or that overlap too much. Quality would also help stem the bleed by cutting warranty costs.
- I'd leverage the survival instinct of people and re-write the union contracts from scratch, immediately.
- I'd throw more money at advanced technologies in the name of doubling the mileage throughout the entire fleet.
- I'd thin the executive ranks and generally streamline the organization.
- I'd put power back into the hands of the division leaders, but I'd require strong business cases for their designs.
- I'd institute some kind of loyalty program to acknowledge and regain the lost customers who abandoned GM over such issues as the intake gaskets, etc.
- I'd simply throw out the entire customer care program and start from scratch. The current one is so bungled and vested in camouflaged protections of GM that it cannot be revived. I'd steal away key leaders from the competition (Honda would be a good target), and put them in charge of a complete re-design of customer care.
- I'd publish a road map for the re-design of the corporation. Sword in the ground and all that. For there to be true consumer confidence and hope, there has to be open disclosure and no more of the typical "we're going remake ourselves" rhetoric which is only met with the same frustrations when customers try to experience a new GM.
I believe that most of the consumer population would like to believe in a new GM, but has heard too many promises which only resulted in the same way of doing business. GM lacks a credibility factor now, in my opinion, and I'd make that one of my highest priorities. I believe that with that credibility factor in place, the consumer would bear with GM as it progresses through a plan.
I'd also tell all of the analysts to go to hell. I'm tired of the same meaningless rhetoric from them as well. The articles that Jim posted prove that point. Multiples of articles, all saying essentially the same thing, all focused on meaningless numbers. Meaningless in that they are numbers that exist in the midst of an action. It takes a long time to turn a big boat and looking at monthly or quarterly numbers, absent a perspective relative to the big picture is just meaningless. That's what annoys me with Jim's incessant posting of every article he comes across. Inside, I scream "Big Deal!". It's all meaningless when a company is trying to turn around. It's even more meaningless when the entire industry is turning down.
So - although not a direct answer to your question, those are my thoughts.
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Actually, it is quite a good answer. Positive steps like the ones you outlined could start rebuilding confidence in the brand.
Talk is cheap,and we have heard lots of talk from GMs leaders.
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snip

That's what the book "the rise and fall of the north american automobile industry", not sure if that's the exact title, talked about. Can't find the book, maybe out of print.

They already dropped one division. So that's a start.

Workers wouldn't give up their hard earned benefits easily.

Ahem. The oil companies wouldn't like that at all either. I think they are too powerfull to let that happen. But that's only my opinion.

And do a complete review of their bonuses.

Rhetoric is also what's used by politicians to put us out to sleep. It's used by all those who have anything to sell us or to make us believe.

All make sens.
Cheers

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hls wrote:

Plenty could be done.
Cut Buick, Pontiac, GMC and Saturn down to one model each and bleed their dealers till they quit. Isuzu is using this strategy to exit businesses it doesn't want to be in.
Sell Saab to any sucker who will take it. Maybe it could be given to the New Chrysler Corporation :).
Up the warranty on the remaining products to Hyundai levels in order to woo customers who have been burned by quality problems in the past. Make sure that this doesn't cost the company a fortune by building in quality to the product.
Focus on Chevrolet and Cadillac and make darn sure that every vehicle on offer has a real argument to make for being best-in-class. Hit Honda-like redesign cycles on all those models without fail.
Tell the fleet buyers they can have as many vehicles as they want, as long as the pay the same price as regular retail buyers.
That should get the ball going!
John
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Mike Marlow wrote:

I find them interesting.
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An equally valid opposing view. Not as good as my view of course, but an equally valid one all the same.
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And you can't find them on your own? You come to a GM newsgroup to read articles that bash GM? That makes a lot of sense. Learn how to use a search engine.
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80 Knight wrote:

I'm an old GM guy, my father won't have anything but GM and I was raised that a Chevrolet (or a Trans Am) were the only cars worth buying.
Once GM axed the F-body we were done forever. I'm still interested in what the company is doing and if it might be worth my time to look at the new Camaro.
These days I have a Nissan Maxima (6 speed), which GM has no competition for and a Infiniti G35 whose only competition is BMW, IMO.
Telling the truth about a situation that GM put themselves into isn't *bashing*, it's just reality. I hope GM gets their heads on straight soon.
B
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Trans Am's are nice cars. I miss my mint '82.

From the concept pictures I have seen, it's quite the car. It is also supposed to be built here in Oshawa, Ontario (from the latest I heard, anyhow), and our plant takes the awards each year for quality.

That Infinity is way out of my league. :-P

You must not have been here long. Jim Higgins only posts negative comments or articles. He doesn't offer assistance for anyone here who ask questions, he never has anything good to say, and he makes it damned well known that he hates GM. All I am saying is why bother? I despise Toyota's, and reality TV shows, but I have never even once visited any of there newsgroup's. Now, if you want to talk about ways GM can improve itself, I'm all for that. Even I can admit they have flaws. If you stay around long enough, you will see Higgins' pattern. He is a Troll, plain and simple.
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80 Knight wrote:

Reality for GM is often bitter.
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snip

When one can only afford an economy car like a Saturn, one cringes when other people boast about the nice carS they own.

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I'm sure that Jim would make room for you under his covers.
Dave
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I havent found an FAQ for this group. AFAIK, this newsgroup is not founded by, supported by, or listened to by GM.
Anybody can post here. It isnt a cheerleaders camp.
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snip

And not everybody has the time to search the Net daily for possible new articles about GM. Their are too many sources of articles. Posting some of them is harmless, IMHO. One can choose to either read them or ignore them.
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wrote in message

Bullshit. You know as much as anyone else that posting constant negative comments to a newsgroup is Troll behavior.
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You have an odd view of negative. He posted factual information. Factual is neither negative nor positive.
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