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U.S. Auto Sales Off to Bad Start: January Toughest on GM and Ford

Posted on: Thursday, 26 January 2006, 06:00 CST

By Sarah A. Webster, Detroit Free Press

Jan. 26--Sales of new cars and trucks have been falling in January, especially for General Motors Corp. and Ford Motor Co., automotive dealership data show.

Retail sales of new vehicles were down 11% in the first half of the month, compared to the same period a year ago, according to a report from the Power Information Network of Westlake Village, Calif., a subsidiary of J.D. Power & Associates.

Automakers will report their monthly sales results on Feb. 1.

The preliminary findings from the Power Information Network, also known as PIN, are based on retail sales data from more than 10,000 automotive dealership franchises in North America.

It does not include fleet sales to government and rental companies.

When those sales are included, the brokerage firm Merrill Lynch predicts sales for the entire industry will be down 2% in January compared to a year ago.

GM and Ford are expected to fare worse than the market, both Merrill Lynch and PIN predict. That could be more bad news for the two domestic automakers, which have announced plans to lay off about 30,000 workers and close more than a dozen plants apiece.

Retail sales are down 28% at GM and 25% at Ford through the first 15 days of January, PIN reports. DaimlerChrysler, which has local operations in Auburn Hills, is performing slightly better, with sales off 13% during the same period.

Merrill Lynch believes the month will end with retail and fleet sales off about 10% at GM, 5% at Ford and 3% at DaimlerChrysler.

The firm predicts U.S. market share in January will be 24.1% at GM, 18.2% at Ford and 14.9% at DaimlerChrysler. That would be down from a year ago, when market share was 26% at GM, 18.9% at Ford and 15.1% at DaimlerChrysler.

One explanation for the sales decline in January: Automakers have been easing off incentives, such as cash-back rebates and special interest rate programs.

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Copyright (c) 2006, Detroit Free Press

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NYSE:GM, NYSE:F, NYSE:MER, NYSE:DCX,

Source: Detroit Free Press

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