OCTOBER 2008 Vehicles Sales
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Auto sales plunge to near 25-year lows
Mon Nov 3, 2008
By Kevin Krolicki
DETROIT (Reuters) - U.S. auto sales plunged near 25-year lows in October, led by a 45 percent drop at General Motors Corp, with no sign the industry's year-long slump had hit bottom and doubts persisting that all the major automakers can survive.
Hurt by tighter credit and deepening uncertainty about the strength of the economy, U.S. sales fell to their weakest monthly level since 1983, based on early sales results.
European auto sales also tumbled for October, with sales declines of 40 percent in Spain and 19 percent in Italy.
Adjusting the figures for the population of the United States, GM said October was the industry's weakest month since the end of World War Two.
Sales for Toyota Motor Co was off 29 percent, Honda Motor Co fell 25 percent and Nissan Motor Co tumbled 33 percent.
"The financial crisis has generated an abrupt constraint on economic activity," said Ford economist Emily Kolinski Morris, who added that the No. 2 U.S. automaker did not think the third quarter represented the bottom of the downturn.
Ford said it could reduce production of passenger cars and crossover vehicles in the coming weeks by cutting overtime and suspending work at some of its plants.
Industry-wide U.S. sales of cars and light trucks were on track to come in below 900,000 units in October after dropping below the 1 million threshold in September for the first time in 15 years, according to initial sales data.
That raised the stakes for a more aggressive round of discounting in November and December as automakers prepared to clear remaining 2008 model-year inventory in exchange for cut-rate financing and other incentives.
GM said it would roll out a "Red Tag" sale with lower vehicle prices and cash-back offers starting on Tuesday.
Toyota, which has overtaken GM as the global auto sales leader, launched a zero percent financing offer in October backed by a high-profile ad campaign aimed to take advantage of the relative strength of Toyota's financing arm.
Nissan launched its own zero percent financing offer for November and December, and expressed confidence that would help its own results move higher from October levels.
"I think there's a lot of consumer uncertainty, but you've also got real-world stories from dealers about how credit has tightened up all around," Nissan division U.S. sales chief Al Castignetti said.
GM, CHRYSLER REMAIN IN FOCUS
GM's North American sales chief Mark LaNeve said auto sales were suffering from the fallout of an "unprecedented credit crunch."
"It was like someone turned off the lights in the month of October," said LaNeve, who estimated that tighter consumer credit standards at GM's affiliated finance company GMAC had cost the automaker up to 60,000 vehicle sales in the month.
The near-freefall in October sales represented the first results since word emerged last month of merger talks between GM and Chrysler LLC, owned by private equity firm Cerberus Capital Management.
GM had sought some $10 billion in government aid to support the merger, a request the U.S. Treasury Department rebuffed last week. That put the focus on whatever support the industry can win from the incoming White House after Tuesday's presidential vote, people familiar with the talks have said.
Chrysler Chief Executive Bob Nardelli said on Monday that while Chrysler had been in talks with other parties, its recent cost-cutting actions were needed to emerge from the downturn.
"The difficult actions we have taken in the past, and those that we have just announced, are for one purpose and one purpose only: helping Chrysler survive this economic trough," Nardelli said in a message to staff obtained by Reuters.
Meanwhile, auto sales were expected to fall by at least 10 percent in Germany, Europe's largest economy, when official figures are released.
In France sales fell 7.3 percent.
(Reporting by Kevin Krolicki; Additional reporting by Soyoung Kim, Poornima Gupta and David Bailey in Detroit, Gilles Castonguay in Milan; Editing by Gary Hill)
Mon Nov 3, 2008
By Kevin Krolicki
DETROIT (Reuters) - U.S. auto sales plunged near 25-year lows in October, led by a 45 percent drop at General Motors Corp, with no sign the industry's year-long slump had hit bottom and doubts persisting that all the major automakers can survive.
Hurt by tighter credit and deepening uncertainty about the strength of the economy, U.S. sales fell to their weakest monthly level since 1983, based on early sales results.
European auto sales also tumbled for October, with sales declines of 40 percent in Spain and 19 percent in Italy.
Adjusting the figures for the population of the United States, GM said October was the industry's weakest month since the end of World War Two.
Sales for Toyota Motor Co was off 29 percent, Honda Motor Co fell 25 percent and Nissan Motor Co tumbled 33 percent.
"The financial crisis has generated an abrupt constraint on economic activity," said Ford economist Emily Kolinski Morris, who added that the No. 2 U.S. automaker did not think the third quarter represented the bottom of the downturn.
Ford said it could reduce production of passenger cars and crossover vehicles in the coming weeks by cutting overtime and suspending work at some of its plants.
Industry-wide U.S. sales of cars and light trucks were on track to come in below 900,000 units in October after dropping below the 1 million threshold in September for the first time in 15 years, according to initial sales data.
That raised the stakes for a more aggressive round of discounting in November and December as automakers prepared to clear remaining 2008 model-year inventory in exchange for cut-rate financing and other incentives.
GM said it would roll out a "Red Tag" sale with lower vehicle prices and cash-back offers starting on Tuesday.
Toyota, which has overtaken GM as the global auto sales leader, launched a zero percent financing offer in October backed by a high-profile ad campaign aimed to take advantage of the relative strength of Toyota's financing arm.
Nissan launched its own zero percent financing offer for November and December, and expressed confidence that would help its own results move higher from October levels.
"I think there's a lot of consumer uncertainty, but you've also got real-world stories from dealers about how credit has tightened up all around," Nissan division U.S. sales chief Al Castignetti said.
GM, CHRYSLER REMAIN IN FOCUS
GM's North American sales chief Mark LaNeve said auto sales were suffering from the fallout of an "unprecedented credit crunch."
"It was like someone turned off the lights in the month of October," said LaNeve, who estimated that tighter consumer credit standards at GM's affiliated finance company GMAC had cost the automaker up to 60,000 vehicle sales in the month.
The near-freefall in October sales represented the first results since word emerged last month of merger talks between GM and Chrysler LLC, owned by private equity firm Cerberus Capital Management.
GM had sought some $10 billion in government aid to support the merger, a request the U.S. Treasury Department rebuffed last week. That put the focus on whatever support the industry can win from the incoming White House after Tuesday's presidential vote, people familiar with the talks have said.
Chrysler Chief Executive Bob Nardelli said on Monday that while Chrysler had been in talks with other parties, its recent cost-cutting actions were needed to emerge from the downturn.
"The difficult actions we have taken in the past, and those that we have just announced, are for one purpose and one purpose only: helping Chrysler survive this economic trough," Nardelli said in a message to staff obtained by Reuters.
Meanwhile, auto sales were expected to fall by at least 10 percent in Germany, Europe's largest economy, when official figures are released.
In France sales fell 7.3 percent.
(Reporting by Kevin Krolicki; Additional reporting by Soyoung Kim, Poornima Gupta and David Bailey in Detroit, Gilles Castonguay in Milan; Editing by Gary Hill)
#32
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Big thanks to Andrew again for compiling this data. Infiniti is hurting bad, only 7k units sold. Mind you the entire lineup is either refreshed or new. The EX is selling very poorly but the all new FX is selling even worse. The G37 update hasn't helped at all. On top of that their nationwide aggresive 0% financing for 72 months hasn't helped them at all.
Acura also is in huge trouble, barely over 10k units. Ignore the TL sales as they are still selling tons of 08 models at discounts with the 09 models. 70k a year is their goal again and selling under 5k a month won't be close to this goal. The Tl will fail as I have predicted the TSX/RL/RDX will.
The TSX is failure as well sadly. Hasn't been even 8 months on the market yet.
Not good that all new vehicles are selling poorly.
BMW didn't even sell 400 X6 models, another all new vehicle that is a huge sales failure.
The Genesis sold over 1k units but its not selling as strongly as Hyundai would like. They were thinking at least 2k units plus at this point.
Not sure why the Accord dropped from 30k to 19k units.
Acura also is in huge trouble, barely over 10k units. Ignore the TL sales as they are still selling tons of 08 models at discounts with the 09 models. 70k a year is their goal again and selling under 5k a month won't be close to this goal. The Tl will fail as I have predicted the TSX/RL/RDX will.
The TSX is failure as well sadly. Hasn't been even 8 months on the market yet.
Not good that all new vehicles are selling poorly.
BMW didn't even sell 400 X6 models, another all new vehicle that is a huge sales failure.
The Genesis sold over 1k units but its not selling as strongly as Hyundai would like. They were thinking at least 2k units plus at this point.
Not sure why the Accord dropped from 30k to 19k units.
Last edited by LexFather; 11-03-08 at 02:47 PM.
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Absolutely HUGE drop for GM. Looks like GM got hammered the most in October.
Civic sales took a big hit, and Accord sales were down HUGE, over a 38% drop! The Altima almost outsold the Accord. Both the Corolla and Camry outsold the Civic and Accord by a big margin in October. The Accord I think got hurt by Toyota's great lease deals, plus likely some cross-shopping with the TL, and also the Accord's large size in general is likely hurting it's sales.
Good start for the TL, but let's see how long such sales last. It could easily pull a TSX.
Looks like BMW outsold Lexus for the month. Lexus though is still ahead year-to-date by a few thousand units.
Civic sales took a big hit, and Accord sales were down HUGE, over a 38% drop! The Altima almost outsold the Accord. Both the Corolla and Camry outsold the Civic and Accord by a big margin in October. The Accord I think got hurt by Toyota's great lease deals, plus likely some cross-shopping with the TL, and also the Accord's large size in general is likely hurting it's sales.
Good start for the TL, but let's see how long such sales last. It could easily pull a TSX.
Looks like BMW outsold Lexus for the month. Lexus though is still ahead year-to-date by a few thousand units.
#34
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OVerall the "experts" are forgetting one big factor. Gas prices. Gas prices are at maybe 3 year lows. That mixed with a recession, mixed with tighted credit, mixed with higher unemployment mixed with no consumer confidence mean people are simply holding on to their vehicles.
That big Expedition no longer needs $100 to fillup, maybe $60. So people will stick to their current vehicles. Even as gas prices are low, people are not driving as much and looking for alternative methods of transportation to SAVE MONEY.
With gas prices lower for the immediate future, that also means the one thing that was holding off the big sales drop, "small cars/econo cars" are no longer the next "BIG THING" as people never wanted them in the first place. Hybrids are no longer seen as the next "Big Thing" either. The 3rd gen Prius might debut with regular gas here under $2 a gallon.
One other point, BMW is RIGHT BEHIND LEXUS for the sales crown. 215k BMW vs 220k Lexus.
Expect to see a BIG PUSH by both companies the next 2 months.
That big Expedition no longer needs $100 to fillup, maybe $60. So people will stick to their current vehicles. Even as gas prices are low, people are not driving as much and looking for alternative methods of transportation to SAVE MONEY.
With gas prices lower for the immediate future, that also means the one thing that was holding off the big sales drop, "small cars/econo cars" are no longer the next "BIG THING" as people never wanted them in the first place. Hybrids are no longer seen as the next "Big Thing" either. The 3rd gen Prius might debut with regular gas here under $2 a gallon.
One other point, BMW is RIGHT BEHIND LEXUS for the sales crown. 215k BMW vs 220k Lexus.
Expect to see a BIG PUSH by both companies the next 2 months.
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OVerall the "experts" are forgetting one big factor. Gas prices. Gas prices are at maybe 3 year lows. That mixed with a recession, mixed with tighted credit, mixed with higher unemployment mixed with no consumer confidence mean people are simply holding on to their vehicles.
That big Expedition no longer needs $100 to fillup, maybe $60. So people will stick to their current vehicles. Even as gas prices are low, people are not driving as much and looking for alternative methods of transportation to SAVE MONEY.
With gas prices lower for the immediate future, that also means the one thing that was holding off the big sales drop, "small cars/econo cars" are no longer the next "BIG THING" as people never wanted them in the first place. Hybrids are no longer seen as the next "Big Thing" either. The 3rd gen Prius might debut with regular gas here under $2 a gallon.
One other point, BMW is RIGHT BEHIND LEXUS for the sales crown. 215k BMW vs 220k Lexus.
Expect to see a BIG PUSH by both companies the next 2 months.
That big Expedition no longer needs $100 to fillup, maybe $60. So people will stick to their current vehicles. Even as gas prices are low, people are not driving as much and looking for alternative methods of transportation to SAVE MONEY.
With gas prices lower for the immediate future, that also means the one thing that was holding off the big sales drop, "small cars/econo cars" are no longer the next "BIG THING" as people never wanted them in the first place. Hybrids are no longer seen as the next "Big Thing" either. The 3rd gen Prius might debut with regular gas here under $2 a gallon.
One other point, BMW is RIGHT BEHIND LEXUS for the sales crown. 215k BMW vs 220k Lexus.
Expect to see a BIG PUSH by both companies the next 2 months.
Prius remains entirely limited by supply as you can see by the sales. Corolla sales in October were UP and Camry sales were solid. Other models like the Fusion also had solid sales holds. The Malibu continues to sell better than the old model. The Accord is the one exception here.
I sure hope you're not underestimating the impact the 3rd-gen Prius will have. It will be pandemonium at dealers when the new model hits.
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I think you can see the effect of Toyota's zero percent financing as well as BMW's .9% on 2008s. Both suffered less than comparable makes (and Mike, the X6 is not supposed to be a huge seller -I still have yet to see one at a dealer - they are out of stock).
Honda on the other hand did not offer any incentives on their Civic last month and I think they only had 3.9% on their Accords. I bet that is about to change.... They did offer .9% on the Pilot (jeez, wonder why).
I do love the spin that these companies put on their press releases. Took me three reads to realize it said Mazda5 instead of Mazda in terms of a record October.....
Honda on the other hand did not offer any incentives on their Civic last month and I think they only had 3.9% on their Accords. I bet that is about to change.... They did offer .9% on the Pilot (jeez, wonder why).
I do love the spin that these companies put on their press releases. Took me three reads to realize it said Mazda5 instead of Mazda in terms of a record October.....
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I think you can see the effect of Toyota's zero percent financing as well as BMW's .9% on 2008s. Both suffered less than comparable makes (and Mike, the X6 is not supposed to be a huge seller -I still have yet to see one at a dealer - they are out of stock).
Honda on the other hand did not offer any incentives on their Civic last month and I think they only had 3.9% on their Accords. I bet that is about to change.... They did offer .9% on the Pilot (jeez, wonder why).
I do love the spin that these companies put on their press releases. Took me three reads to realize it said Mazda5 instead of Mazda in terms of a record October.....
Honda on the other hand did not offer any incentives on their Civic last month and I think they only had 3.9% on their Accords. I bet that is about to change.... They did offer .9% on the Pilot (jeez, wonder why).
I do love the spin that these companies put on their press releases. Took me three reads to realize it said Mazda5 instead of Mazda in terms of a record October.....
I disagree about the X6. Its a total flop. 20k a year is not even close to reach. Doug they went from over 800 a month the last couple months to under 400. They might sell 10k in their first full year, a 50% sales target miss, ala the Infiniti EX.
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It's amazing how even the auto mags, and other childrens literature, really hate the X6, from concept through execution but wind up putting it on their buy lists for SUVs in their new buyer's guides.
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The X6 is an emotional buy. I admit the vehicle makes very little sense practically and even financially, but if I could afford it as a second or third vehicle I would probably buy one.
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On the Market Share I have to disagree. Market share has and always will be a very important measuring stick. Sure the market is shrinking but that is all the more reason you need your share to go up.
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Agree the spin is hilarious to read. I guess they are trying to impress the common folk because those in the know can smell it for what it is. They are doing a poor job though because the messages being relayed by the mass media are "down 30-40%" not "great month for Mazda 5". ;-)
On the Market Share I have to disagree. Market share has and always will be a very important measuring stick. Sure the market is shrinking but that is all the more reason you need your share to go up.
On the Market Share I have to disagree. Market share has and always will be a very important measuring stick. Sure the market is shrinking but that is all the more reason you need your share to go up.
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lol, TRD r u okay? I think u mean 33rd or 34th vehicle right?
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Big thanks to Andrew again for compiling this data. Infiniti is hurting bad, only 7k units sold. Mind you the entire lineup is either refreshed or new. The EX is selling very poorly but the all new FX is selling even worse. The G37 update hasn't helped at all. On top of that their nationwide aggresive 0% financing for 72 months hasn't helped them at all.
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I enjoyed reading your theory of sales of the manufacturers, but maybe you can provide us with one about why Lexus is down 38% when most of the lineup is only a couple years old or less.