Declining Sales Rock Auto Industry

Dismal Figures Are On Pace To Be The Lowest In 15 Years; Companies Blame High Gas Prices

(CBS/ AP)  General Motors Corp. soundly beat Toyota Motor Corp. in June to retain its traditional U.S. sales lead, but GM sales still dropped 18.2 percent during a dismal month for most large automakers.

Toyota's U.S. sales fell 21.4 percent, while Ford Motor Co. said it sales tumbled nearly 28 percent.

Annual auto sales, which hit 17 million in 2005, slowed to 16.1 million last year, and are expected to skid another 10% this year, reports CBS News Business Correspondent Anthony Mason

"We haven't seen a double digit decline in the automotive industry in decades," said auto industry analyst Rebecca Lindland with Global Insight.

Officially, U.S. auto sales are on pace for their worst year since 1993, with an estimated 14.5 million units in 2008 expected to be sold, down from an average of 16.8, reports CBS News correspondent Jeff Glor.

Ford was the first automaker to report sales data Tuesday. Analysts had predicted June auto sales could drop by double-digits to their lowest monthly rate in 16 years. Ford shares sank to a new 52-week low, while rival General Motors Corp. shares are trading near their lowest level in more than a half century.

GM's shares bounced nearly 6 percent higher in afternoon trading Tuesday after sinking to their lowest level in more than a half century during Monday's session.

The nation's biggest automaker on Tuesday reported selling 262,329 vehicles for the month, compared with Toyota's 193,234. Some industry analysts had expected Toyota to beat GM in the U.S. for the first time, but both companies were hurt by a sluggish economy and poor sales of trucks and sport utility vehicles.

Toyota car sales fell 9.4 percent in June while its truck sales were off 38.8 percent.

GM's car sales sank 21 percent in June, while its incentive-boosted truck sales were off 16 percent.

For the first half of the year, GM sales fell 16.3 percent compared with the year-ago period. Toyota sales were down 6.8 percent for the first six months of the year.

Toyota took the global sales lead from General Motors in the first quarter, capitalizing on growth in China and Europe as GM saw its North American sales drag down gains in other markets. GM barely won the global sales race with Toyota last year, but Toyota overtook it as the world's top automaker as measured by global vehicle production in 2007.


Honda Motor Co., with its car-heavy lineup, reported a 1.1 percent sales increase for June, with a 19.3 percent rise in car sales offsetting an 24 percent drop in trucks.

But Ford, still reliant on trucks and sport utility vehicles, saw its sales drop 27.9 percent.

Industry analysts had predicted June auto sales could drop by double-digits to their lowest monthly rate in 16 years.

Dearborn-based Ford blamed the latest sales decline on high gas prices and low consumer confidence, which sent buyers to the sidelines. It reported steep drops in June sales of pickup trucks and sport utility vehicles, including a 41 percent year-over-year decline for the F-Series pickup, a perennial best-seller, and a 52 percent drop for the Ford Explorer SUV.

George Pipas, Ford's top sales analyst, said SUV sales are probably down for good.

"Our view is that gas prices aren't likely to go down, and more importantly, many consumers have moved on," he said. "We believe that the segment has merit for certain consumers but is not likely to rebound at any point."

For the first half of the year, Ford's sales were down 14 percent compared with the year-ago period.

U.S. auto sales had already fallen for seven straight months as of May, the longest period of consecutive monthly drops in eight years, according to the auto information Web site Edmunds.com.

When customers do buy, they're picking smaller cars, crossovers and hybrids.

With gas prices soaring, drivers are looking for more fuel-efficient models. But there aren't many options on the lot, Mason reports.

"Only about 12 percent of all vehicles out there get better than 25 miles per gallon." Lindland said.

Ford said sales of its smallest car, the Ford Focus, rose 28 percent in the first six months of the year, although Focus sales fell in June. Pipas blamed the decline on supply problems and a cut in sales to fleet buyers.

The automaker said last month it plans to increase production of the Focus as well as the Mercury Mariner and Ford Escape small SUVs.

Ford shares sank to a 52-week low of $4.41 early Tuesday but recovered to $4.72, down only 9 cents, in afternoon trading. They have traded as high as $9.64 over the past year.

The market responded well to GM's news. Its shares rose 67 cents, or 5.8 percent, to $12.17 in afternoon trading after briefly falling as low as $10.57 during Monday's session, the lowest level since Sept. 22, 1954, according to the Center for Research in Security Prices at the University of Chicago.

The Associated Press reports unadjusted auto sales figures, calculating the percentage change in the total number of vehicles sold in one month compared with the same month a year earlier. Some automakers report percentages adjusted for sales days. There were 24 sales days last month and 27 in June 2007.

[fiberglass3]

The 3 major US auto manufacturers are not listening to the demands of auto buyers. Their television commercials are still featuring large vehicles with internal combustion engines. They talk about miles per gallon at a time when we are looking at kilowatts and electric consumption as our future. An electric motor has only one moving part.

Gasoline pricing has become way to volatile and unpredictable. A hole in a pipeline, a storm, a hostile government in some foreign country, a tanker stranded at sea, futures trading - all affect the price.

When the cost of gasoline went past $ 3.00 per gallon our family canceled Easter travel and summer vacation. We just can%u2019t afford to be spending that much on transportation.

[libsluv2spit]

C O N S E R V E - ride the bike, take the bus, carpool, walk....we can no longer live in excess..

stop buying these huuuuuuuuuuuuuuuuuuuuuuuuuuuuuuge useless suvs and 4x4s and watch these 3 car giants step on each other to give you fuel efficient ''eco'' friendly cars..

[radiob-2009]

When will we learn, Europe has had small cars for years.
Drive down the road and see a 100lbs. woman driving a huge SUV with no passengers, going to the store for milk.


--------------------------------------------------------------------------------

Posted by fstop100

Hmmm I have two Buicks one with a Corvette 5.7 litre that gets 28 mpg on the highway and another that is a V-6 that gets 30 mpg highway and 24 city. It''s not the size of the engine it''s more factors than that. You can have your beat your bones to death 4 cylinders that only get 32 mpg.

[fstop100]

When will we learn, Europe has had small cars for years.
Drive down the road and see a 100lbs. woman driving a huge SUV with no passengers, going to the store for milk.

[ajaxtheleast]

Chimp an''zee Darth may find that knocking
over a few buildings in Iran wont be enough
for this escalating oil price rise where the
big man from OPEC says these rises come with
no guarantee that they wont continue to rise.

The reasons for the rises abound. Here''s #150:

Would it be so out of character for Arabs to
say "The time has come! The weakened wicked
man of the west must pay! Pay for invading an
Arab country and for humiliating the fine
upstanding leader of that country whom all
Arabs universally loved and respected by
showing him on TV being checked for fleas?"

Would this be so out of character for a
group still tlt-for-tatting thousand-year-
old slights? . ."speculation" doesn''t seem
to have grabbed hold. You got #151?

(In other words wouldn''t it be hilarious
if Arab blood, after all, turned out to be
thicker than oil when face with a lame-
brain-and-duck president who killed half
a million of their own.?)

[faith_in_w]

gslinger3, no it doesnt. Just be glad they take your worthless dollars and dont insist on silver wafers.

[radiob-2009]

Democrats, Republicans auto makers do not get it, every auto can be converted to run off of natural/propane/methane gas which when converted from BTU''s to gallons equals .83 a gallon average vs the price of gasoline $4+ and rising. Fuel cells are already in autos in CA, if mass produced the price would come down. All of these would lower our cost, dependence on foreign oil and create jobs.

[gslinger3]

The SUV is dead, Park it and buy yourself somthing that gets 30 mpg, if everyone does that we decrease our demand for oil by 50% !!!!!!!!! Then the price has to go down!!! Economics 101 people, learn it!!!!!

NOBAMA 08!!!!

[gslinger3]

Humanavance,

It is ignorance such as yours that is killing our country! Come on people, get educated and start thinking for yourselves!!!!!

NOBAMA 08!!!

[element51]

URSODUMB....I''m sure you are not on here now but I have to say that your screen name fits you very well. You are an insulting ******** who has no concept of what is going on in the world. It is people like you who spread the lies and rumors that make it difficult to find actual truth. You sound like you are about 14 years old with a learning disibility. You just aren''t ready to play with the big kids yet.

[reptilian96]

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Now Fox News has learned some U.S. investigators believe that there are Israelis again very much engaged in spying in and on the U.S., who may have known things they didn''t tell us before September 11. Fox News correspondent Carl Cameron has details in the first of a four-part series

[naucoming4u]

And be very, very, wary of the Democrats, for they have an aversion to wandering from the trail.
ST

Posted by Humanavance at 03:51 AM : Jul 02, 2008
.............

A Democrat in the White House, once again, will demonstrate that they are only different in name, but similar in ulterior motives.

Of course, this is not news to you, me, and many others on this board.

[ndg1979]

Most automakers, ESPECIALLY GM, would not be in this predicament if the EV-1 had come to America''s roadways. For those not familiar with it, the EV-1 was GM''s production ready concept 100% electric car. Yet, GM itself, under pressure from government and industry leaders, effectively sealed the fate of the 400 produced for a test lease program.

And what was GM''s response to not mass-producing an oil free vehicle? They said, "It was not the right time." And what was used as the government-controlled, media-supported distraction? It was the hydrogen concept vehicle, brought out into the public eye quickly. By the way, this electric vehicle came out nearly a decade ago. It could have revolutionized driving the world over, put GM ten years ahead of it''s competitors and cemented it as an icon in American automobile history.

Oh well, guess when people stop buying cars altogether, it might actually be time for the all-electric vehicle to make its comeback. Don''t believe me, look up the EV-1 and the independant documentary - Who Killed the Electric Car?

[shanev137]

Why is this news? Anyone with half a brain knows our entire economy is doomed and is going down the drain.

[oneworldusa]

...And they couldn''t see this coming 3 years ago when Big Oil started pillaging American consumers after Hurricane Katrina???

The CEOs'' lack of judgement and foresight must be denounced. They must go and leave their parachutes behind.

[noloyalisti]

It''d kind of hard to feel bad for these giant right wing corporations. They take none of the risk, only care about the bottom line and run the United States war machine and Congress. What''s not to like?

[noloyalisti]

It''d kind of hard to feel bad for these giant right wing corporations. They take none of the risk, only care about the bottom line and run the United States war machine and Congress. What''s not to like?

[apprxam]

Hoooooooray! GM is still number one; only lost 18%.

What industry with the power to avoid these horrible loses would constantly place itself at the behest of big oil, risk total collaspe, fight tooth any regulation to improve and only after being dragged kicking and screaming, taut their poor and late entry into the future as an American business success. The big freakin three, that''s who.

These jacka88es had thirty years to get their *** together. Know they''re closing plants and firing workers and losing billions of dollars because of market-focus, short-viewed profit schemes. After getting rid of Carter and watching Ron Reagan triumphedly tear down solar panals and reduce C.A.F.E. standards, who the hell has won in the long run? 1-800-TOYOTA 1

[brianbwb-2009]

"Dismal Figures Are On Pace To Be The Lowest In 15 Years; Companies Blame High Gas Prices"

Typical neocon response, blame some one else for the fact that for years they refused to make more fuel efficient vehicles, continued to raise the sticker price, while lowering quality, and themselves laid off millions of the best car buyers, those who were basically slave labor, returning the cost the company paid them to build the cars, plus profit.

30 years ago, they knew more energy efficient vehicles were the key to the future, but ignored wisdom, and now that the future is today, they want to blame high gas prices, of which their stubbornness in continuing to sell guzzlers was the main cause.

[harpoot]

My heart bleeds for the auto industry. Ha ha ha ha