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Discussion Starter · #1 · (Edited)
Automakers Post Worst Q1 Sales in Years



Automakers could only wish that the March sales numbers reported on Apr. 1 were a joke, but no one was laughing.

U.S. light-vehicle sales for the month of March fell 12% from the year-ago month, to 1,356,868. That was the worst result so far this year, based on monthly year-over-year comparisons. For the first quarter of 2008, U.S. sales were down 8% from the year-ago quarter, to 3,577,293.

Each of the Big Three had large double-digit sales decreases in March: General Motors (GM) fell 18.9%, to 277,751. Ford Motor's (F) sales dropped 14.2%, to 212,379. And Chrysler's fell 19.4%, to 166,386.

The news wasn't much better for imports. Sales also fell 10.3%, to 217,330, for Toyota Motor (TM). Honda Motor's (HMC) dropped 3.2%, to 138,734, and Nissan's (NSANY) fell 3.8%, to 106,921.

More Losses to Come

Consumers are putting off buying cars and trucks in the face of economic uncertainty and high gas prices. "A consumer who's worried about employment and the financial outlook is unlikely to invest in homes and vehicles. In the same way, businesses are reluctant to invest in new capacity. And banks and financial institutions are less likely to loan money for them to do these things, or they will charge a higher rate to do so," says Emily Kolinski Morris, Ford's senior economist for North America.

The auto industry could lose more than 400,000 sales this year as consumers put off acquisitions, due to issues related to housing, credit, and debt load, according to a survey by CNW Marketing Research, in Bandon, Ore.

Small cars, small SUVs, hybrids, and car-based crossovers—and some luxury brands—are the only product segments posting year-over-year sales gains. Ford said sales of its Edge crossover were up 23.8% in March over the year-ago month. For the quarter, Edge sales were up 47.2%, but it was an easy comparison because the Edge was launched in the year-ago quarter.

Toyota "Not Immune"

Gas-sippers including the hybrid Toyota Prius, the hybrid Camry, and the tiny, gas-powered Toyota Yaris all had record U.S. sales in March, said Bob Carter, Toyota division group vice-president and general manager, in an Apr. 1 conference call with reporters. "Fuel economy is foremost on the minds of consumers," he said.

However, the poor March results overall in the U.S. industry prompted Toyota to trim its U.S. auto industry sales forecast for the year. Toyota had been at the high end of a range of forecasts from analysts and other automakers. "It's clear the industry will be off our initial forecast of 16 million units this year," Carter said.

Without making a precise prediction, he said Toyota's new forecast will be in the mid-15-million range. That's roughly in line with Ford and GM, which stuck to their earlier, more pessimistic forecasts despite the March results. For the full year, that would be the worst sales total in at least a decade. U.S. sales in 2007 were about 16.1 million, down 2.5% from 2006.

"We are not immune to economic cycles, and we are not immune to auto industry downturns," Carter said. It certainly has seemed that way, as Toyota has enjoyed a couple of decades of more or less uninterrupted growth in U.S. sales. According to the Ward's Auto Web site, looking at Toyota's U.S. results for the last seven months vs. the year-ago period yields the worst year-over-year comparisons the Japanese automaker has posted since 1982. To be fair, the year-ago results include several all-time monthly sales records.

"Certainly that's not a situation we like to be in," Carter said. "But we have been growing market share six out of those seven months. I would like to show month-to-month gains, but the market is not giving us that today."

http://www.businessweek.com/lifestyle/content/apr2008/bw2008041_036455.htm?campaign_id=yhoo
 

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from the "On the table" side at Autoextremist www.autoextremist.com

(3 arrows down) The Biz. From "The Sky is Falling" File, comes word that March sales were in the dumper (no big surprise), and with no relief in sight it's shaping up to be a grim spring and summer. Toyota sales were down 10.3 percent. For the record, that makes seven out of the last nine months of downward sales for "The Juggernaut," which hasn't happened in 25 years. Chrysler sales were down 19.4 percent. GM, down 18.7 percent. And Ford sales were down 14 percent. Even though there were two fewer selling days, March was u-g-l-y. Bright spots? The Ford Edge is selling well in California (an encouraging sign), and the new Ford Focus was up more than 30 percent in March. GM's Buick Enclave-GMC Acadia-Saturn Outlook trio performed nicely, as did the Chevrolet Malibu and Impala. Other than that, the car biz is reeling, and it will get worse before it gets better.

(one arrow up, one arrow down)Toyota. The Japanese automaker's conquer-the-world growth plans have been derailed by the swooning economy in the U.S,. and the dreaded "O" word - for overcapacity - is now becoming part of the Toyota lexicon. The good news, at least for Michigan? the automaker is pumping another $100 million into its existing complex outside Ann Arbor to do research on safety and efficiency.
 

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Gas prices are up $0.50 from last year, food prices are up over 13%, disposable income is tapering down due to fears of a recession, people are spending less on superfluous stuff like a new car to keep up with the Jones' and were keeping them longer....hey, automakers....DUH! What do they expect? Maybe they need to learn how to run lean instead of flooding the market with something not everyone needs to buy once a year. The times, they are a'changing. Again. Adapt or die.
 

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Gas prices are up $0.50 from last year, food prices are up over 13%, disposable income is tapering down due to fears of a recession, people are spending less on superfluous stuff like a new car to keep up with the Jones' and were keeping them longer....hey, automakers....DUH! What do they expect? Maybe they need to learn how to run lean instead of flooding the market with something not everyone needs to buy once a year. The times, they are a'changing. Again. Adapt or die.
Disposible income is not down because of "fears" of recession, Its down because of pay cuts, look around, airlines requireing give backs, GM Ford getting consessions, my own company cutting people's wages by 25%, its all around, and when my pay goes down by 18K I stop spending, adding to the recession. im not cutting back because of fears of recession, its because of loss of wages, and the snowball contioues to roll down hill.
 

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This may be news to the auto companies, but even though I make good money I just can't afford to drop $30K+ on a new car every year. I bought my latest car brand new 2 years ago, and I plan on having it for 10 years before I'm ready to buy another new car.

My wife would like (and will soon need) a new car, but we'll most likely pick her up a 1-2 year old car that has already taken the big depreciation hit. That's what we did with her current car, and it saved us 50% over buying new.
 

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Our economy is so messed up right now. We have tens of millions who want to buy a new nice car. We've got car workers who want to make them and have hugely increased their productivity over the last decades. And we've got steel workers who want to work and mine the steel for the cars and who have also massively increased their productivity.

Yet something is broken, middle class people can't get money into their hands, to buy those shiny new cars.
 

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Discussion Starter · #8 ·
Disposible income is not down because of "fears" of recession, Its down because of pay cuts, look around, airlines requireing give backs, GM Ford getting consessions, my own company cutting people's wages by 25%, its all around, and when my pay goes down by 18K I stop spending, adding to the recession. im not cutting back because of fears of recession, its because of loss of wages, and the snowball contioues to roll down hill.
Huge Job Losses Set Off Recession Alarms
http://biz.yahoo.com/ap/080404/economy.html
 
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