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Thread: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too

  1. #1
    Vulture of The Western World Eric's Avatar
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    Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too

    Tight credit, economic worries and high gasoline prices combined to crush the sales of U.S. and foreign automakers alike last month, with Ford, Toyota, Chrysler and Nissan all posting drops of more than 30 percent.

    Ford Motor Co.'s 34 percent decline marked its worst sales month this year, and the results across the industry are a strong indication that the financial turmoil that has swelled since mid-September is pushing the auto industry deeper into its trough.

    General Motors Corp., buoyed by its offer of employee pricing on most of its vehicles, saw U.S. sales drop a less severe 16 percent, boosting the automaker's market share to its best level all year.

    Dealers from many manufacturers said their customers are having an increasingly hard time qualifying for loans to buy autos, as banks have restricted lending because of widespread mortgage defaults that led to disruptions in the financial markets and the collapse of several banks. Plus, several automakers' finance arms have limited or discontinued leasing.

    Jim Farley, Ford's group vice president for marketing, said economic conditions have raised uncertainty among buyers.

    "Even if you have good credit, there's a reluctance to pull the trigger on a big ticket item," he said.

    Nissan Motor Co., which posted significant sales increases in July and August, saw its sales plunge 37 percent on double-digit drops in demand for nearly every one of its models.

    Chrysler LLC said its sales tumbled 33 percent, and Toyota Motor Corp.'s sales fell 32 percent. Honda Motor Co., one of the few automakers that had posted sales growth through August, reported a 24 percent drop.

    George Pipas, Ford's top sales analyst, said nearly all automakers saw "extremely weak" sales in the waning days of the month as the Wall Street crisis grew and Congress debated the government's $700 billion bailout of the financial industry.

    "It was tantamount, really, to a natural disaster," he said.

    GM's market share grew to more than 28 percent in September because it experienced smaller sales drops than its competitors, said Mark LaNeve, the automaker's vice president of North American sales.

    The share did not come with the expense of incentives, which he said averaged only $100 per vehicle more than in August and were flat from July to August despite the monthlong employee pricing offer, LaNeve said.

    Incentive spending was reduced, he said, because GM did almost no leasing during the month.

    But even though it may have gained market share, LaNeve said the numbers were still down year-over-year.

    "A few years ago I'd have jumped out the window with these numbers, and we're on the 39th floor here," he said in a conference call from GM's downtown Detroit headquarters.

    If overall U.S. industry sales drop in September, it will be the 11th straight monthly decline when compared with the year-ago period. That would be the longest string of down months since 14 straight negative months ended in December 1991, according to Autodata Corp. The industrywide figures were unavailable until later Wednesday.

    Buyers continued to favor small fuel-efficient cars over trucks and sport utility vehicles. Ford's truck sales were down 39 percent, while car sales dropped 19 percent. The numbers do not include Ford's Volvo Cars unit.

    There were few bright spots in Ford-Lincoln-Mercury model lineup last month, with sales of all but three models far lower than the same month a year ago. Sales increased only on the Focus small car, up 5 percent; the Crown Victoria large sedan, up 3 percent; and the Lincoln Town Car, up 69 percent.

    Sales of F-series pickup trucks, Ford's top selling vehicle, were down almost 42 percent for the month.

    But Pipas said full-size pickup truck sales were better industrywide when compared with May levels, due largely to increased incentive spending. He also said residual values have improved on pickup trucks and SUVs since May, putting many customers in a better position to trade in vehicles.

    Ford, like its U.S.-based competitors, has been trying to shift its factories and model lineup from trucks and SUVs to more efficient cars and crossover vehicles, while burning through billions of dollars in cash. The Dearborn-based automaker has mortgaged its assets to stay in business and, as of July, had burned through nearly $11 billion of its cash stockpile in the past year.

    GM has performed strongly overseas, but plummeting demand for its most profitable products in the U.S. has forced it to close factories and lay off workers, and it burned through $3.6 billion in cash in the second quarter alone.

    Light truck demand at GM fell 19 percent in September, as sales of the Trailblazer dropped 31 percent and demand for the Tahoe fell 52 percent. Sales of Chevrolet full-size pickups fared comparably better, edging down just 5.5 percent.

    GM's car sales slid 10 percent, as a 17 percent drop in Cobalt sales and combined declines of more than 30 percent for both Cadillac and Buick cars off set a 68 percent jump in Malibu sales and 17 percent increase in demand for its Impala.

    Nearly all of Chrysler's models posted sales declines. The few models to post gains included its Caravan and Town & Country minivans, which both posted 6 percent increases.

    Overall, Chrysler car sales fell 29 percent, while sales of light trucks dropped 34 percent.

    Ford shares fell 65 cents, or 12.5 percent, to close at $4.55, while GM shares closed unchanged at $9.45. Toyota's U.S. shares fell $1.90, or 2.2 percent, to close at $83.90, Honda's U.S. shares lost 51 cents, or 1.7 percent, to close at $29.60, and Nissan's shares dropped 51 cents, or 3.8 percent, to $13.08.

    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, one less than in September 2007.

    ___

  2. #2
    Administrator Ken's Avatar
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    Re: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too

    Eric wrote (in part);
    Dealers from many manufacturers said their customers are having an increasingly hard time qualifying for loans to buy autos, as banks have restricted lending because of widespread mortgage defaults that led to disruptions in the financial markets and the collapse of several banks. Plus, several automakers' finance arms have limited or discontinued leasing.
    My brother Graham a.k.a. 'Screenman', who is in the motor trade as a PDR and Screen Repair specialist said his business is getting very slow. Many of the main dealers who would normally be selling thirty to forty vehicles a month are now down to one or two. In the workshops the mechanics and fitters have little work and have usually finished all the available work by mid-day. Luckily Graham also runs a PDR training school so the downturn has not affected him as much as most.

    Ken.
    Die dulci fruimini!
    Ken.
    Wolds Bikers, Lincolnshire, England.

  3. #3
    Vulture of The Western World Eric's Avatar
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    Re: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, t

    Quote Originally Posted by Ken
    Eric wrote (in part);
    Dealers from many manufacturers said their customers are having an increasingly hard time qualifying for loans to buy autos, as banks have restricted lending because of widespread mortgage defaults that led to disruptions in the financial markets and the collapse of several banks. Plus, several automakers' finance arms have limited or discontinued leasing.
    My brother Graham a.k.a. 'Screenman', who is in the motor trade as a PDR and Screen Repair specialist said his business is getting very slow. Many of the main dealers who would normally be selling thirty to forty vehicles a month are now down to one or two. In the workshops the mechanics and fitters have little work and have usually finished all the available work by mid-day. Luckily Graham also runs a PDR training school so the downturn has not affected him as much as most.

    Ken.
    It is bleaker than I have ever seen it in my 16 years of being an auto journalist; and overall, the situation seems more alarming than anything I have witnessed in my entire life.

    I doubt GM, Ford (let alone Chrysler) can withstand even two more years of losses....



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    Senior Member misterdecibel's Avatar
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    Re: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too


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    Senior Member misterdecibel's Avatar
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    Re: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too

    http://www.msnbc.msn.com/id/26876247

    GMAC pulled their floor plan. Dealer chain collapsed.

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    Re: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too

    The story I heard (not sure if it's even slightly true) is that Bill Heard Chevrolet had lots of legal expenses from angry customers suing them, and that's why he didn't have the reserves to weather this downturn.

    Chip H.

    Former owner: 2012 Honda Civic LX, 2006 Honda Ridgeline RTL, 2000 Honda CR-V EX, 2003 MINI Cooper S, 1992 Honda Accord LX, 1999 Mercedes ML-320, 1995 VW Jetta GLX, 1991 Mercury Capri XR2, 1981 Mercury Zephyr, 1975 Chevrolet Impala

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    Senior Member misterdecibel's Avatar
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    Re: Even Toyota's beginning to squeal; sales down 30 percent... Ford & Nissan, too

    Quote Originally Posted by chiph
    The story I heard (not sure if it's even slightly true) is that Bill Heard Chevrolet had lots of legal expenses from angry customers suing them, and that's why he didn't have the reserves to weather this downturn.

    Chip H.
    I imagine that's one reason why they were in enough financial trouble to make GMAC pull their floor plan.

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