US Auto Sales Fall in March

[DainBramaged]

Source: Associated Press

DETROIT (AP) — Automakers reported double-digit U.S. sales declines in March as demand for trucks and sport utility vehicles plummeted and consumers held back because of concerns about gas prices, the housing slump and tightening credit.

General Motors Corp. and Chrysler LLC both reported a 19 percent drop in U.S. sales Tuesday. Ford's sales dropped 14 percent and even industry stalwart Toyota was down 10 percent compared with last March. Nissan fell 4 percent, and Honda reported a 3 percent drop. Some automakers warned things could keep getting worse in the near term.

"I'd like to be able to tell you that the worst is behind us, but I really can't give you that assurance," Jim Farley, Ford Motor Co.'s sales and marketing chief, said in a conference call. Farley said Ford is concerned the shrinking availability of consumer credit will continue to hurt sales and that the second quarter could be more difficult than the first.

GM's truck and SUV sales were down 22 percent in March while its car sales fell 14 percent. New vehicles like the Chevrolet Malibu were a bright spot, with sales up 17 percent, but sales of Chevrolet pickups were down 25 percent while sales of GM's gas-guzzling Hummer brand fell 29 percent. GM's sales were down 11 percent for the first quarter.

"There's no question that the industry and the economy is in a weakened state," said Mike DiGiovanni, GM's executive director of global markets and industry analysis. "We expected the first three quarters to be weak, and this has exceeded what we thought."



Read more: http://ap.google.com/article/ALeqM5gsz39lpYrNG7OiKs3FJt6jhV6NEwD8VP9F880

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When the vaunted Japanese brands have sales declines, you know the economy is in trouble. And this will be the third month in a row.

[OwnedByFerrets]

1. My mothers husband is a new car salesman....

and they are hurting so badly. She just had to sell her home or lose possibly lose it.

[A HERETIC I AM]

2. The automobile industry defines the term "cyclical"

and slow sales months simply mean pent-up demand is growing. From reading your posts, I take it you've been in the business for a while. You must know this is the case. They'll have a few slow quarters and then sales will increase.

It's happened before and it will happen again.

[DainBramaged]

3. If credit dries up, demand means nothing

The fastest growing segment is used cars under $5000.

[A HERETIC I AM]

4. Also temporary.

Like I said, the sales will slow for a few quarters - how many a "few" is is anyones guess - and then they will pick up again.

The credit market will not dry up completely and will loosen again with time. There is still money to borrow, it's just not as cheap as it was 18 months ago.

[maseman]

5. You are correct HERETIC

Mainly because people MUST have vehicles. A vehicle is nearly as important to survival as food, water, clothes, etc. Unless you live in a metropolitan area like NYC there is bad public transportation. In addition most people have to drive a decent amount to and from work. Therefore as their autos age they need to replace them.

Granted, the vehicles people are buying will more likely be the less costly small cars rather than Hummers, SUVs and Trucks. If the big three were smart they would start making smaller, gas efficient cars. (Hello K-Car? Remember the Aries?)

It will turn around but probably not until late 2008 or early 2009.

[DainBramaged]

6. With ZERO percent financing and attractive leases

ALL of the manufacturers are keeping up the sales of gas burners. If you are saving $30 per thousand per month financed, gas becomes less of a concern.


Trust me, the gas burners are still selling well. Read the article. And people with larger families are NOT going to smaller vehicles, they are parking the large one until they absolutely need it.

[depakid]

8. Nope Americans won't give up their wasteful habits until they're forced to

by economic realities.

I just saw some guy plop down 5 $20 bills at the local minimart- and get a few bucks back in change.

Wow!

Now, imagine when that's 150 bucks and all he gets is a little change.

The party's over, it's just that neither Detroit nor the average American knows it yet....

[DainBramaged]

10. It's not just Detroit, and someday the members of DU will acknowledge that

Detroit didn't cause the problem of big cars and Suv's, ALL of the industry did because people WANTED them, period. I get so tired of watching Detroit take the blame for that.

Toyota's bread and butter is not selling Prius', it's selling 4Runners, FJ's (gas sucking pigs all) Highlanders, Sequoias, RAV4, Sienna's, Tundras, Land Cruisers and all of the v6 Camry's they can push out the door, they aren't making a profit on the Prius.


And they are coming out with another luxo-barge, the Venza in the fall to compete in the $30K+ range of low millage cross overs. Another victory for style over substance, as usual for Toyota.

Does anyone here actually think Honda or Toyota or Nissan or Mazda is in business to lose money??

[depakid]

15. Detroit shares the blame -it's called "Demand Creation"

and they've been spending billions on it with respect to SUV's for years.

This dysfunctional trend has been a staple of the "American diet" reinforced constantly in commercials, and other media. Toyota et al. have only being fairly recent players in the destructive cycle.

Conversely, demand destruction, brought on by the economic realities of rising petroleum prices and their consequent effects on the more petrol dependent sectors of the economy, will attenuate the cycle- and also create opportunities- if the executives are smart enough to abandon "group think" and anticipate the market conditions several years down the road.

I often wonder how Americans will adapt to $5 per gallon petrol, combined with unaffordable health care, lower real wages and substantial inflation of basic necessaries, such as food and heating (or air conditioning).

There will be interesting times ahead, for sure.

[DainBramaged]

22. "Toyota et al. have only being fairly recent players in the destructive cycle."

Bullshit, you obviously don't know the product mix they sell, how long they have been selling these products, and how important SUVs are to them, Nissan and now Honda. And if you went to their website, you'd see just where they concentrate their marketing efforts. They have emphasized gas guzzlers for nearly 15 years now. And if they were so pure, why are they suing the EPA to roll back the newest CAFE standards???????????

Another victim of Japanese marketing surfaces.:eyes:

[jakefrep]

19. Exactly!

EVERY major carmaker operating here has at least one SUV in their product range. It's the price of admission for staying relevant in the American market. And they certainly wouldn't build them if they couldn't make a reasonable profit doing so.

Ever wonder why the small cars available here uniformly suck? Because the manufacturers don't want to devote too many resources to cars they can't sell profitably. When somebody comes up with a scheme to sell a Ford Focus in the US at a comparable profit to an F150 or Explorer, I'm sure Detroit (and every other manufacturer) will be all ears.

[girl gone mad]

11. Anecdotal evidence..

I drive a 10 year old Geo which gets about 41 mpg. I've had two unsolicited offers on it in the last month, both from complete strangers. I've never had that happen before.

[Neshanic]

12. I rented one for a week when they were in rental fleets. They are

amazing little cars! Zippy and quick, and they ran forever on a tank. I would love to have one of those. No wonder you are getting offers from strangers.

[Javaman]

7. but but but...

the market is up 400 points!!! all is well!!! all is well!!

[OhioChick]

9. Who can afford or risk

purchasing one at a time when the economy/employment is unsettling to say the least.

[snooper2]

13. Good...I hope it plummets...

I need a newer truck within a year :evilgrin:

[tomreedtoon]

14. Car advertising is dying too.

I work in TV. My station gets about sixty commercials a week from a big Toyota dealer. Commercials of all lengths, shot daytime and nighttime, scheduled throughout the week. That's sixty new commercials per week that run multiple times.

But the other local car dealers have stopped doing infomercials. Mind you, these simply are the dealers bragging about their dealership, their service, how they treat customers and the like; they don't offer specific prices on specific cars in these things. They are incessant back-patting. But they used to do these all the time; we had a time slot on Saturday morning on our independent station where six or seven half-hour infomercials used to play, just about car dealers. Now that's gone.

Maybe these dealers should stop telling the public what wonderful guys they are, and offer some specific, concrete car prices to prove how wonderful they are. Naaaah, what am I, crazy? They want to stick the customer for everything they can get and they can't legally advertise a price without being forced to honor the deal.

[DainBramaged]

17. What does a price on a car mean if NO two cars are equipped the same

And since the auto manufacturers are all following the Saturn lead of cutting gross margins by lowering sticker prices but not increasing dealer profit, how can you be sure you are getting any kind of a deal??


There is no such thing as "deal" on a car any longer. If you think you are getting a big discount off of a "list" price, chances are there is factory support money behind that discount. And they are ALL doing it. And unless you are getting factory sponsored low rate financing, it's a crap shoot as to what your final payment will be.

The LEAST expensive car in America is a Chevy Aveo, 5-speed no Air Conditioning, and the dealers can sell it for $9995. It gets over 34 MPG highway. It comes with a 5 year 100,000 mile power train warranty and 3 year 36000 mile bumper to bumper warranty.

If you want a CHEAP, economical car, there is NOTHING out there to match it, including the Honda Fit and Toyota Yaris, which get THE SAME millage and cost about 2500 more similarly equipped.

So you were saying about low prices??

[tomreedtoon]

18. I said CONCRETE prices, not LOW prices.

I was talking about what the dealers promote in their TV advertising.

Most car infomercials are the dealers telling themselves what wonderful guys they are. They have no noticeable effect on bringing people into the dealerships.

On the other hand, the Toyota spots I mentioned - at least - show specific models with specific equipment and put a price on them. That's fact-based advertising.

I don't want to get involved in arguments about the buying and selling of cars. Everyone knows it's a slippery slope to get on, involving "honesty" and "value" and other stuff that make for eternal arguments. I'm talking about what the dealer says about himself in his ads, and his arguments why a normal slob would trust him over any other dealer.

And for the record, free hot dogs and helicopter rides don't make me want to go to a dealer. They would make me suspicious that the dealer has nothing but cheap-ass gimmicks to offer.

[DainBramaged]

20. Concrete prices are not real and are meaningless

You aren't buying a LCD TV. Prices in ads for ONE car are useless since the chance of GETTING that one car is next to impossible (because of the wonders of TV and the Internet and the number of people who see that ONE car).

Price should never be the single determining factor for buying a car. Are you comfortable, is there enough space for your family, or do you simply want the cheapest piece of shit you can get??

The price of the car means NOTHING unless you are paying cash, then tax, tags and doc fees add to the price. Then factor in the insurance cost per month, and what did the concrete price of the car get you? Financing adds about $30 per thousand financed, so one last time, a CONCRETE price means nothing.

[tomreedtoon]

23. All right, why do YOU buy a car from Jimmy Bryan Toyota?

Which is a dealer that is out of business, so I can use their name quite appropriately.

Do you buy from Jimmy Bryan because his spokesman has the shiniest hair? Because he claims to have a good repair department? Because he claims to be Orlando's only Toyota dealer because he's the only one located in the city limits (with about four just outside)?

You completely misunderstand what I've been asking. I don't want to buy a car. NOBODY wants to buy a car now. Most Americans will NEVER buy a new car any more. But when they did buy cars, what IN THE TELEVISION ADVERTISING convinced people to go to a particular dealer? Shut up about the price and the comparisons and equipment and all that nonsense. You go to a particular dealer to buy. WHY? Tell me, please.

[DainBramaged]

24. Well, you're completely wrong about no one buying new cars any more

And the industry is still on track to sell over 14 MILLION this year, so I think I know a little more about the business than you do. Actually a lot since I've BEEN IN IT for the past 15+ years. And the comparisons I made are not nonsense, it just proves how little you really know about the business.

Most people go to dealers because of 1) previous good experiences buying a car or on recommendations from friends or relatives 2) the overall reputation (including service) after research of BBB records or again from friends or relatives 3) how long the dealer has been in business 4) proximity to their home for service after the sale.


Price rarely makes the deal. An example. A dealer has been in business for over 79 years at the same location. Yup 79 years. The third generation of the family now runs the business. The sales people each average over 20 years continuous service there, with the most senior having been there for 27 years. FOURTH generation family members now are coming in to buy cars because their Great Grand parents and Grand Parents and Parents bought cars and trucks there. And there are 47 same-branded dealers (and over 100 total dealers) within 50 square miles of where I live.

Where I live TRUST is a HUGE factor in the buying and selling of cars. It's not unique, and there are dealers who have been in business 50+ years, 75+ years and nearly 80 years. A few dollars don't make the difference in a sale, because down the road, all that is moot if you lose the trust of your customer.

That's the difference in what I know and what you know, and it isn't nonsense. :smoke:

[tomreedtoon]

25. You STILL don't understand my question, DainBramaged!

Yes, in old America you might buy the car from the same person who sold your daddy his car, who sold HIS daddy his car, and like that. But that doesn't work in 2008.

I guess you live in Detroit, but I live in Orlando, Florida. In all the ADI markets (Area of Dominant Influence, an advertising term) we are #1 in the nation for automobile advertising. We get a LOT of car ads from a lot of dealers on our TV stations. We are a hot market for cars.

In Orlando, and in most areas of the nation, car dealers have merged and combined. The aforementioned Toyota dealer, once the original owner died, was bought and combined with other car dealers. It's not surprising to see a Chevrolet/Jeep/Honda combination dealership. There is no "history" any more. They are all owned by entities as unreachable and incomprehensible as Donald Trump. And usually just as greedy. And their salesmen are driven like mules to get results; they can either win the trip to Miami, the steak knives...or get fired, like in that play/movie.

THEREFORE, since these are Mystery Men we are all buying cars from, history and reputation doesn't exist. The only way the car dealers have to establish an identity is television advertising, and hopefully staying out of the Better Business Bureau's Evil Retailers files. But mainly their TV advertising.

And since this America 2008, we don't talk to our neighbors. We don't even know their freaking names. We suspect they're running crack labs in their garages, but we're afraid to go look for fear of getting killed. So you don't ask your neighbors for their advice, either; don't even suggest it.

So I ask the question again. READ THE ABOVE AGAIN before you answer. What other means do you have to determine where you will buy your car besides TV advertising? I think your only true answer must be "none."

Oh, and you guys in Detroit can make 14 million cars, but Americans will only be buying about 37 of them - and that's the rich ones. Probably all 37 will be bought by Jay Leno. What are your bosses going to do with the rest of them?

[DainBramaged]

26. (sigh)

I live in one of the ten richest counties in the country (you should have just looked at my profile or my journal) and people here still buy cars the way I described. And our NUMBER ONE source of leads is the Internet. Not TV/cable. Not newspapers (the only people reading newspapers read the obituaries). The Internet. Period. We put ALL of our emphasis there. Cars.com, Kelly Blue Book, The Gannett web sites, Autobytel.com, you name it, we're there. And mailings are extremely effective for service and body shop promotions.

I'm sorry your experience and scope is so limited. I did my best to educate you, but you just don't get it.

Cya.

[NickB79]

21. It's amazing how cheap South Koreans can build Aveo's these days

And my grandfather loves that 100,000-mile powertrain warranty on his 2006 Aveo; he had to use it after 38,000 miles when he started to discover a puddle of gasoline under his car every morning!

[durablend]

16. Yeah, keep pumping those behemoths out!

The bigger the better! Everyone knows people want EVEN BIGGER when gas prices skyrocket!

:sarcasm: