August 2, 2008
Auto Sales Plunge Again
By Dee-Ann Durbin
General Motors, Ford, Toyota and other automakers said Friday that their U.S. sales fell by double-digits in July as they struggled to keep up with consumers' growing demand for smaller, more fuel-efficient vehicles.Nissan Motor Co. was the only major automaker to report a gain, with truck sales up a surprising 18 percent thanks in part to the new Rogue crossover. Nissan's overall sales rose 8.5percent.
Automakers were expecting July sales to be at their lowest level in more than a decade as sales of trucks and SUVs continued to plummet and new troubles in the auto leasing market further wrecked consumers' confidence. And they said things could get worse before they get better.
"We expect the second half of 2008 will be more challenging that the first half as economic and credit conditions weaken," Ford's marketing chief Jim Farley said in a statement.
At the same time, automakers are having trouble matching their production with customers' sudden demand for smaller vehicles. Small cars represented 27 percent of sales in July, up from 21 percent a year earlier, while demand for pickups fell to 11 percent from 14 percent the year before.
GM said its July sales plunged 26 percent, led by a 35 percent decline in sales of trucks and SUVs. But even GM's car sales fell 12percent as GM failed to keep up with demand for fuel-efficient vehicles like the subcompact Chevrolet Aveo.
Earlier Friday, GM reported a $15.5 billion second-quarter loss, the third-
worst quarterly performance in the company's history, largely due to North American sales losses and expenses from a massive restructuring plan.
Ford said its U.S. sales fell 15 percent compared with a year earlier. Its car sales were flat, and sales of the Focus small car rose 16 percent. But sales of Ford's trucks and SUVs continued their steep decline, falling 22 percent.
Toyota Motor Corp. said its sales fell 12 percent last month, led by a 27 percent drop in truck and SUV sales. Sales of its Prius hybrid fell 8 percent as Toyota failed to keep up with growing demand for the fuel-efficient car.
Toyota officials said the automaker is accelerating production of four-cylinder engines to meet demand for its Yaris and Corolla models.
Chrysler LLC, whose lineup is more tilted to trucks and SUVs than any other major automaker, said its sales fell 29 percent, with truck and SUV sales down 30 percent.
Even Honda Motor Co., which has reported sales increases in the past few months as consumers flocked to its fuel-efficient cars, said sales fell 2 percent in July. Honda's car sales were up 14 percent, but results were dragged down by a 22 percent drop in truck and SUV sales.
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