Auto Sales Plunge In Face Of $4 Gas

[Purveyor]

Source: CNNMoney

With gas at record highs, buyers stay away from SUV and pickup models, hitting May sales at GM, Ford and Toyota.

June 3, 2008: 3:54 PM EDT

NEW YORK (CNNMoney.com) -- U.S. auto sales tumbled in May as buyers fled from pickups and sport utility vehicles in the face of average gas prices that are now just shy of $4 a gallon.

The trouble hit not only U.S. automakers General Motors (GM, Fortune 500), Ford Motor and Chrysler LLC -- which have long depended on sales of pickups and SUVs -- but also trimmed the sales of their top Japanese rival Toyota Motor (TM).
--
GM reported that overall sales plunged 27.5% in the month, far worse than the 19% drop forecast by sales tracker Edmunds.com.

The declines were led by the 37% tumble in the sales of light trucks, such as pickups and SUVs. But even sales of cars fell 14% during the month.
--
Chrysler LLC, the privately-held automaker that was purchased by Cerberus Capital Management last year, saw sales fall 25%.
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Ford reported that overall U.S. sales were down 16 percent, even worse than the forecast of a 9% drop from Edmunds.com. Sales of light truck models, such as SUVs, pickups and vans, tumbled more than 25%.
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Toyota reported a 4% drop in combined sales of its Toyota and luxury Lexus brands. Edmunds was forecasting a 3% decline. Sales of light trucks fell 12%, while its car sales were flat.



Read more: http://money.cnn.com/2008/06/03/news/companies/autosales/index.htm

[texastoast]

1. And GM has closed four pickup/SUV factories

They shoulda seen this one coming.

[Purveyor]

2. I remember it was only a couple of years ago when they announced they

were going to focus their development and marketing on trucks and SUV's.

To think, these corporate decision makers make millions.

I still maintain their strategy is to drive GM into bankruptcy in order to eliminate the union contracts and pension obligations. JMO

[kestrel91316]

6. Heck, that wasn't even a couple of years ago. They just said that

in 2007, IIRC.

[raystorm7]

7. Greed trumped all as far as they were concerened. Like you pointed out, it was planned.

People aren't payed millions to be this stupid.

[AndyTiedye]

13. Cheney Told Them There'd Be Lots of Cheap Gas from Iraq, and They Believed Him

[geomon666]

3. They did see it.

They just didn't count on us not being as stupid as they originally thought.

[texastoast]

26. Talking to a car salesman one time long ago after the

compact cars of the 1970s were all the rage after OPEC's rising, he said that gas price fluctuations were very good for the car business. So, here we are, rushing out to replace SUVs. I wonder if history will repeat itself and in 5-7 years gas prices will seem "reasonable" enough to buy big vehicles again.

[vinylsolution]

4. Eliminating American blue-collar jobs....

.... has been the corporatists' mission for the last 20 years.

Margaret Thatcher tried it out first in Britain, Reagan started it here, Clinton signed NAFTA to accelerate it, and Bush jr gleefully stood by and watched his country's manufacturing strength shrivel to almost nothing. Spineless b*stards all....

[Dogmudgeon]

22. Clinton signed NAFTA?

http://en.wikipedia.org/wiki/North_American_Free_Trade_Agreement">Not in this dimension, he didn't.

--p!

[bulloney]

23. NAFTA was begun by Reagan, and finished by Clinton.

Clinton wasn't an innocent bystander of the approval, either. The agreement initially stood to fail in Congress until the Clinton administration met with blocs of congressmen and promised them special provisions in NAFTA or some other legislation in exchange for their 'yes' vote.

This showed the sheer hypocrisy of this agreement. Everyone strutted around preaching the virtues of "free trade," yet many of them held out their vote so that some pet industry in their district received protection from NAFTA.

[Dogmudgeon]

29. Nor was he the evil heavy many DUers think he is

Bill Clinton had nothing to do with passing NAFTA. It was signed in December 1992. There was nothing for him to promise or finish; NAFTA was a matter of law when he was sworn in, and it came into effect on 1/1/1994. But Clinton did manage to extract major labor and environmental concessions from the GOP after its passage. Under revisionist history, he has become the bad guy to the Democrats and Republicans alike.

Yet somehow, he managed to oversee the creation of 22 million jobs; compare to Bush's paltry 2 million. I defend the Clinton record because in spite of its (and his) flaws, we still enjoyed the best run of economic activity we had in 30 years. Why we are so eager to disown it is an exercise in perversity.

There is just no excuse for us to put the "propagate" in Republican "propaganda". This is all easily found on Wikipedia and via Google. Opinions may vary, but the dates and legal citation numbers are now easy to track down. The same way that over 75% of Americans once thought Saddam Hussein had ordered the 9-11 attacks, so do most people think that NAFTA was the work of Bill Clinton.

You are right -- there is plenty of hypocrisy to go around in Washington. The pre-NAFTA status quo was also a labor nightmare. What we really need now are comprehensive progressive labor and business policies that enrich the entire "food chain", not just privileged groups here and there. The constant flow of Clinton-bashing revisionism -- accompanied by factual inaccuracies like "Clinton signed NAFTA" -- is the same nonsense from a different bunch of culture warriors. Our criticisms of Bill Clinton ought to be a cut above those of the Republican screech monkeys, and preferably to build (upon) success.

This is what President Obama will have to build on. I think it's a good jumping-off point, even with eight years of Republican vandalism and our own circular-firing-squad backbiting.

--p!

[mdmc]

32. I remember the 92 election

The DLC and GOP both supported NAFTA.
Ross "Giant sucking sound" Perot stood in opposition.

[SpiralHawk]

5. This is the skanky fruit of so-called 'conservative' republiconomics

have created the republicon recession/depression.

Thanks a pantload, 'conservative' republicons...

[KillCapitalism]

8. According to other news I have heard...

sales of the Geo Metro on ebay and Craigslist are way up. Why can't anyone build an inexpensive 50mpg car like that anymore?

[lithiumbomb]

15. safety, emissions, cost

The Geo Metro (and it's contemporary the Ford Festiva, which I've owned two of), were simple lightweight hatchbacks. The 3 banger Geo would get 50 mpg on the highway. The Geo weighed about 1600 lbs I think and the Festiva weighed 1700 lbs. There is no way in heck they would meet anything close to modern safety standards.

For comparison, look at the new smart ForTwo for the US market. It weighs about 1800 lbs, seats just two (unlike four for the Metro and Festiva), has a little more horsepower, and is similarly slow/quick. And it tops out in the 40mpg range with its gasoline engine. The base model starts at around 12-13k, I think, and I'm sure Mercedes is losing a few grand on every single model sold as it's built in Europe. No diesel as it doesn't meet emissions. The diesel smart gets 60mpg or so.

Volkswagen's previous US market diesel would get 50mpg highway in an otherwise normal Golf/Jetta/Beetle, but emissions regulations sent it away for a couple of years. The newly introduced US market diesel meets emissions regulations but gets in the low 40s I believe. I wouldn't call that an entry level car but more a "premium compact." I've seen a couple on the road but I don't think they're for sale yet, so I do not have pricing, expect it in the 20-25k range to start.

Making a cheap, efficient, small car _that a company can make money on_ is not as simple as we wish it was. As fuel gets more expensive, demand will move toward smaller efficient cars, thus making them at least marginally profitable, so... it will hopefully correct itself in a few years.

[truthisfreedom]

9. People must put gas in the same budget as their car payment.

Remember when it seemed almost everyone had a used car?

[silverojo]

28. All but one of our cars were used cars

The only new car we bought was a 1979 Buick Opel, back in the days when economy cars were "in". If only it would have had any pickup at all (it went from 0 to 50 in about 5 minutes), it would've been great.

But we've since bought used cars, because they're more economical...plus, you know about the recalls, etc., that have already been issued. It would suck to buy a new car, then learn that there's a minor problem that might cause your transmission to fall out on the road, some dark and stormy night.

And one other thing...new cars' seats SUCK. Hard as bricks, and the headrests jackknife your head forward. Hardly ergonomic....

[OwnedByFerrets]

10. It isnt just $4 gas.....

its this depressing recession in its totality. If it were just the gas prices, sales would still be brisk in the smaller car market. Many folks cant afford that new car, period.

[bulloney]

24. That's because credit is tighter. Thank you Bear Stearns.

[defendandprotect]

11. The battle to keep the MPG low to serve oil industry interests is over . . . ???

Now --- nationalize our oil industry and return control of our natural resources to the people ---

Then --- let's get going with ELECTRIC CARS --- !!!

How many more OIL wars do we want???

[defendandprotect]

12. This is huge culture change . . . which could have begun gradually 30 years ago . . .

but the oil industry waged deadly war against us ---

These were changes which should have begun in the 1960's --

Does right-wing propaganda work --- ??? You bet --- !!!

[BadGimp]

14. I was able to lease a new Ford Explorer Sunday for cheap cheap cheap

The guys at the dealership are shell shocked. Their inventory of the formerly popular F150, 350 etc pick ups is getting ridiculous.

I had to choose a V8 to haul my boat (please don't hate me, I always wanted to own a boat). The explorer was the smallest vehicle with a V8 I could find.

Since I work from home so I don't drive much at all, and use very little gas each month.

I am having a bumper sticker made for it: "My Other Car is a Gas Hog Too", just to tweak the the "enviro friendlies" here in Portland. God bless em one and all.

[Auggie]

16. And the dominoes begin to fall...

[Towlie]

17. Bummer for the Hummer

I hear they're going to stop making them.

[mdmc]

31. I might buy GMC stock if they stop the Bummer line

:toast:

[roamer65]

18. Let the inflationary depression begin...

It's gonna be a very rough ride, folks.

[scarface2004]

19. three words for our way out....

motorcycle, motorcycle, motorcycle...v twin or other will do!

[Igel]

21. I've thought about getting one, for local trips I have to take solo.

But I'm not going to put my kid on one.

[natrat]

20. prius' are getting 3k markups

[lutefisk]

27. Before paying that, people should shop around. List price or better where I live.

Plus, at this point it's worth holding out for the 2009 or 2010 models. There will be some great high mpg choices coming out.

[Historic NY]

25. I holding out for 0% financing deals......then I hope they make this

http://www.motortrend.com/future/concept_cars/112_0802_2008_gmc_denali_xt_concept_first_look/index.html

Its 50% better on fuel base on australian GM vehicles.

[ravencalling]

30. Interesting story..

In my recent vacation, at the car rental place, upon bringing our Aveo(?)Very small compact car.. trying to remember the name of it vehicle back to the car rental, a couple who was also checking in came over and oohed and ahhed at the car! I have never seen so much excitement, as if they were viewing something made of gold!

"Look honey!".. "Can we look inside please?".. The couple were both thinking of getting a new car, and were asking us about the gas mileage during our trip.

Here is this well worn, very small compact, which the man had a bit of trouble getting into by the way.. and they were literally gushing over it as if it were some ultra custom luxury vehicle! Running their hands over the seats, etc..

[Pavlovs DiOgie]

33. Good

Maybe they'll learn that Americans want cars that get much better gas mileage. Hopefully they'll get that technology that's been sitting in someone's file folder to make highly fuel efficient cars and start manufacturing them. I have a hard time believing they don't already have the technology to do that, but now that they're also getting fucked by the oil companies they'll make them.