Some years ago, there was a horrific freeway crash in the US. After surveying the carnage, a state trooper told a reporter: “I just wanted to pin my badge to the seat and go home.” After studying the August sales carnage last night, we wonder if any Detroit automaker executives felt much the same way.
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Total light vehicle sales last month were down 15.3% to 1,246,053. YTD sales were down 11.2% to 9,762,247, according to Ward’s Auto. AutoData calculated a seasonally adjusted, annualised rate of 13.72m units in August, down sharply down from 16.3m a year earlier but up from the 16-year low of 12.55m in July.
The grim facts, adjusted for selling days by Ward’s, included: Chrysler was down 34.8% to 109,740 units, Ford off 25.5% to 152,118 and General Motors fell 20.3% to 307,379.
Ford said its decline reflected lower demand for SUVs (down 53%) and trucks (down 39%) and lower sales to fleet customers (down 31%).
We’d have pulled the computer’s plugs and headed for the nearest neon sign flashing the word ‘cocktails’.
Several months of plunge have seriously impacted the year-to-date results too: – Chrysler off 24.4% to 1,072,456, GM down 18.1% to 2,130,656 and Ford falling 15.4% to 1,438,128.
Overall, the North American brands were down 24.9% to 569,249 sales in August and off 18.9% to 4,641,375 YTD.
So, is there any sign of improvement? “We’re very encouraged by what we saw in August, and it gives us reason to think we’re pulling our way out of this thing,” GM’s sales and marketing chief, Mark Laneve told Reuters. “Hopefully, we will start scratching our way back to numbers that are improving on a month-on-month basis.”
“We had our best sales month so far in 2008,” he said in a statement announcing the extension of the current ’employee discount’ sale to 30 September and the addition of more 2009 models to the eligible list of vehicles “because our 2008 stock on dealer lots is rapidly disappearing”.
“With the recent moderation in fuel prices, we’re seeing some relaxation of pent-up demand in pickups and utilities,” La Neve added.
“Our August sales of these segment-leading trucks and utilities has been the best in nearly a year and August marked the fourth consecutive month that truck sales as a percentage of GM and industry sales increased. We also saw double-digit retail increases in our crossovers compared with July.”
“We expect the second half of 2008 will be more challenging than the first half, as weak economic conditions and the consumer credit crunch continued,” said Ford marketing chief Jim Farley.
Ford now plans to produce 890,000 vehicles in the second half of 2008, down 50,000, following a downward revision of its US industry sales forecast to the low end of the previously stated range of 14.0 to 14.5m.
GM has also revised its second-half production plans. The third-quarter production forecast is down about 10% to 920,000 vehicles (443,000 cars and 477,000 trucks) that will reduce the number of trucks produced by about 176,000 and increase the number of cars by about 76,000.
The initial fourth-quarter production forecast is down around 16% to 875,000 vehicles (436,000 cars and 439,000 trucks).
“Softer gasoline prices recently may have helped the sales of pickup trucks and other large vehicles, but it’s too early to say the worst is over for the US market,” Mizuho Investors Securities analyst Atsushi Kawai told Reuters.
But Edmunds.com analyst Jesse Toprak said the market may have hit a bottom in July.
“Bad news is we’re still down from a year ago, but the good news is that we saw some improvements over the last couple of months thanks to a combination of lower gas prices and incentive spending,” he told Reuters.
Things weren’t so rosy in Asia import brand land, either, though at least Nissan (+13.6% to 108,501 in August; +1.0%, 726,209YTD) had something positive to report, as did minnow Subaru (+14.2%, 18,932 August; +5.8%, 129,298YTD) thanks to some new products.
Toyota was off 9.4% to 211,533 units last month and down 7.8% to 1,649,043 for the year so far. Honda August sales slipped 7.3% to 146,855 but were up 1.7% for the year at 1,083,957.
Horror stories included Mitsubishi’s 29.3% August plunge to 9,200 (-22.4%, 72,727YTD) and Suzuki’s 31.8% nosedive to 6,083 last month (-5.3%, 70,434YTD).
Asian brands were, however, off just 5.6% last month to 594,827 and down 3.4% to 4,494,932 for the year so far.
Among the Europeans, Porsche was down 44.9% in August to 1,404 (-17%, 19,618YTD) but BMW was up 1.0% to 30,931 (-2.5%, 217,821YTD), Daimler flat at 20,944 sales (and up 10.9% to 175,010YTD) while Volkswagen slipped 2% to 28,698 last month and was off just 0.1% to 216,491YTD.
European brands on the whole dipped 1.8% to 81,977 and were up 1.2% to 628,940 for the first eight months.
Crunch it by category and cars were down 7.6% to 631,218 units last month (domestics off 12.1% to 418,587; imports up 2.5% to 212,631) while both domestic and import truck brands fell 22% to a sector drop, also off 22%, of 614,835. YTD, domestics were off 20.2% and imports down 15.4% in a total category down 19.4% to 4,641,836.
Ford’s F-series truck, defiantly, was still top (359,971) of the individual model heap for the year to the end of August, ahead of Toyota’s Camry (326,076) and Chevy’s Silverado (320,074), Honda’s Civic (264,138) and Toyota’s Corolla/Matrix (258,369).
Graeme Roberts
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