U.S. Auto Sales Fall Sickeningly in October

(MoneyWatch)  General Motors executives were stunned at the size of the drop in U.S. auto sales in October, to the lowest annual sales rate in 25 years, as the credit crunch and low consumer confidence kept shoppers at home.

"In my 27 years in the business, I never saw a month like this," said Mark LaNeve, vice president, GM North America vehicle sales, service and marketing. He said that adjusted for population, per-capita U.S. auto sales in October were the worst in the post-World War II era.

U.S. auto sales fell to 838,156 in October, down 31.9 percent from the year-ago month, according to AutoData Corp. September sales made headlines for being the first month since the last recession, in 1991, that monthly auto sales fell below 1 million. For sales to fall below 900,000 the following month is an ominous sign.

AutoData said the Seasonally Adjusted Annual Sales rate in October was only about 10.6 million units. That was the lowest since February 1983, the firm said. In the year-ago month, the SAAR was about 16 million units.

"The carnage was completely widespread," LaNeve said. GM sales fell 45.1 percent from the year-ago month; Ford, down 30.2 percent; Chrysler, down 34.9 percent; Toyota, down 23 percent; Honda, down 25.2 percent; Nissan, down 33 percent.

"Most of our big dealers have multiple franchises, including imports," LaNeve said. "When I spoke with them this (past) month, nobody ?€" nobody ?€" told me they were having a good month. Everybody was down 25 to 50 percent. It was like somebody turned out the lights in the month of October," he said.

LaNeve acknowledged he's usually among the most upbeat, optimistic auto industry executives, but in a Nov. 3 conference call, he said he couldn't summon his usual optimism. "This is serious stuff," he said.

"We've been hoping that with the bailout package, hopefully we would have a normal downturn, a mild recession. Now what's happened is, it's affected the real economy more than we thought. We're much more concerned than we were a month ago," LaNeve said.

That's bad, because a month ago, LaNeve said that before the present downturn, September sales would have made him jump out a window. In September, GM sales were down 15.6 percent, according to AutoData.

"This is clearly a severe, severe automotive recession," said Mike DiGiovanni, GM executive director, global market and industry analysis. "This is something we really can't sustain."