July Auto Sales Hit 16-Year Low

Posted: August 4, 2008

July sales results were dismal for almost every automaker.  Among major manufacturers, only Nissan, Mercedes-Benz and BMW's MINI division showed any sales growth last month. 

Reuters reports, "U.S. auto sales plunged to a 16-year-low in July, led by a 27 percent drop at General Motors Corp, as high gas prices and tight credit sent the industry into a tailspin."  The sales drop was "steeper than analysts had expected and showed an accelerating downturn in the world's largest vehicle market as Americans abandoned the SUVs and trucks they had favored for more than a decade." 

The slide marks nine straight months of declining auto sales -- a pattern not seen since 2001.

AFP reports that GM sales "plummeted 26.7 percent in July from a year ago," and the automaker's "adjusted loss per share was four times greater than market expectations."  Ford saw a 14.9 percent decline, while Chrysler suffered a 29 percent drop despite a surge in lease deals ahead of an August 1 deadline for Chrysler dealerships to stop leasing vehicles.  "The picture among the Big Three's big Japanese rivals was mixed.  Toyota sales slid 18.7 percent and Honda sales dropped 9.2 percent, while Nissan trucks helped drive that company's overall sales 8.5 percent higher."

Analysts attributed Nissan's truck growth to "large incentives for consumers," according to the Wall Street Journal.

The AP adds, "Automakers expect things to get worse before they get better."  Ford marketing director Jim Farley told reporters, "We expect the second half of 2008 will be more challenging that the first half as economic and credit conditions weaken."  Those who are buying are looking primarily for small, fuel-efficient cars, but automakers are "having trouble matching their production with growing demand for smaller vehicles."

Autoblog notes that MINI saw an adjust daily sales rate growth of 14.9% in August, despite the fact that the BMW division is essentially sold-out of cars for 2008 and now only selling pre-ordered 2009 models. 

Mercedes-Benz also reported some sales growth.  Auto Spectator credits strong sales of "the volume-leading C-Class and highly acclaimed E-Class model lines" for the sales increase, which pushed Mercedes sales almost 12% higher than last July.

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