NEW YORK (AP) - November U.S. vehicle sales at General Motors
and Chrysler plunged more than 40 percent, while Ford's sales
dropped 31 percent, crushing hopes that the industrywide drop in
vehicle demand might be easing as the U.S. automakers prepare to
state their second case for a federal bailout.
GM's sales fell 41 percent, while Chrysler's dropped 47 percent.
Their overseas rivals posted abysmal results Tuesday as well.
Toyota's November U.S. sales tumbled 34 percent, and Honda's fell
Like retailers of other big ticket items, automakers have taken
a beating in recent months as worries about the economy and
unemployment have prompted consumers to slash spending. At the same time, some people afraid that they won't qualify for credit or that
it will be too costly have put purchases on hold.
On Monday, the National Bureau of Economic Research said the
U.S. entered a recession in December 2007, much earlier than most
October's seasonally adjusted annual sales rate of 10.6 million
vehicles was worst in more than 25 years and far below the rate of
16 million a year earlier, according to Autodata Corp.
Many analysts had expected November sales to come in slightly
better, noting that aggressive incentive spending and the plunge in
gasoline prices may have put a floor under sales. But GM, Ford,
Chrysler, Toyota and Honda Motor Co. all posted month-over-month
sales declines, pointing to a potential industrywide drop.
Chrysler LLC said its November sales decline included a 59
percent decrease in demand for cars and a 42 percent decline in
Officials said the drops were partially a result of a 63 percent
decline in fleet sales. Excluding such sales, the Auburn Hills,
Mich.-based automaker said its November sales fell 36 percent.
Detroit-based General Motors Corp. reported a 44 percent drop in
demand for cars, while light truck sales dropped 39 percent.
Mike DiGiovanni, GM's executive director of global market
analysis, blamed GM's sharp sales decline on the global economic
crisis and the credit squeeze.
"What we are facing is not a General Motors problem; what we
are facing is an industry problem," DiGiovanni said in a
conference call. "We are seeing further deterioration in the
industry into November."
DiGiovanni said the U.S. auto industry was in a worse state of
recession than the broader economy, "and some might say bordering
on a depression."
Jim Farley, Ford Motor Co.'s group vice president of marketing,
said he expects the industry to post continued year-over-year
declines in auto sales until at least the second half of 2009.
"We could see some strengthening in the second half of next
year, or at least some stabilization, albeit at a much lower
level," Farley said in a conference call with analysts and
Farley said sales began November at an improved rate but began
skidding around midmonth, coinciding with the Detroit Three's
presentation to Congress for $25 billion in loans. But he cautioned
that numerous factors worked together to hobble sales.
"The talk of the bailouts and the bankruptcies and all the
uncertainty and job loss has obviously done little to bolster
consumer confidence," Farley said.
Mark LaNeve, GM's vice president of North American sales, also
acknowledged that media coverage of the proposed auto industry
bailout likely had a negative affect on sales, though he said it
was difficult to quantify.
Dearborn, Mich.-based Ford said light truck sales for its
namesake brand, Lincoln and Mercury were off 29 percent compared
with November 2007, while the three brands' car sales were down 32
But Ford said its market share grew in November, helped by a
recovery in its pickup truck segment and demand for the Ford Fusion
sedan. Sales of Ford's top selling F-Series pickups dropped 19
percent, significantly less than most of the automaker's other
models, while sales of the Fusion fell 27 percent.
George Pipas, the automaker's top sales analyst, attributed that
improvement in part to the sharp decline in gasoline prices and
added the company will increase the proportion of its truck
production early next year.
"In effect, right now we need more trucks and we need fewer
cars and crossovers," Pipas said.
Toyota Motor Corp., Japan's No. 1 automaker, said truck sales
plummeted 36 percent, while demand for passenger cars fell 32
percent, despite the automaker's extension of zero-percent
financing on a dozen vehicles through the end of the month.
Toward the end of the month, Ford also announced offers of
employee pricing, zero-percent financing and cash incentives on a
variety of its vehicles in a move to offset one of the worst sales
declines in the industry's history.
Automakers' sales reports are coming in the same day the
U.S.-based automakers were scheduled to present plans to Congress
for how they expect to return to profitability. Ford, GM and
Chrysler will go before lawmakers this week to ask a second time
for a combined $25 billion federal loan to stave off bankruptcy.
Concessions are also expected from the United Auto Workers
Union. UAW leaders from across the U.S. planned to hold an
emergency meeting in Detroit on Wednesday to discuss concessions
the union could make to help the companies get loans.
GM shares gained 4 cents to $4.63 in afternoon trading. Ford
shares rose 12 cents, or 4.7 percent, to $2.67, while Toyota's U.S.
shares rose $2.40, or 4.1 percent, to $60.96, and Honda's U.S.
shares gained 46 cents, or 2.3 percent, to $20.40.
The Associated Press reports unadjusted auto sales figures,
calculating the percentage change in the total number of vehicles
sold in one month compared with the same month a year earlier. Some
automakers report percentages adjusted for sales days. There were
25 sales days last month, the same as in November 2007.
AP Auto Writer Dan Strumpf contributed to this report.
(Copyright 2008 by The Associated Press. All Rights Reserved.)