New car sales slump after 'cash for clunkers' ends

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Original article at LATimes

September auto sales drop 23% from a year earlier. GM’s plunge 45% and Chrysler’s fall 43%; Honda and Toyota also report double-digit slides. Kia and Hyundai have double-digit increases.

New car sales fell in September as the predicted post-“cash for clunkers” slump dragged the U.S. market down to its lowest levels in seven months..

For September, automakers sold 745,997 cars and light trucks, a 23% slide from a year earlier, when 964,873 vehicles sold. Calculated on an annualized basis, an important industry measure, sales ran at just a 9.22-million-unit clip, according to AutoData Corp. That’s the lowest level since February, when the rate was 9.12 million.

Nearly every major automaker reported declines for the month. General Motors Co. showed a 45% dip from a year earlier, delivering just 156,673 vehicles, and sales by Chrysler Group fell 42%, to 62,197 units.

Ford Motor Co. said its sales dipped 5.1%, with 114,655 units sold; Nissan reported selling 55,393 vehicles, a 7% slide from the previous year; and Honda Motor Co. sold 77,229 cars and trucks, a 20% decline. Toyota Motor Corp. said its sales declined 12.6%, with 126,015 vehicles sold.

The only large automakers to report a year-over-year increase were Hyundai Motor Co. and Kia Motors Corp., with increases of 27.2% and 24.4%, respectively, on a combined total of just over 53,000 units sold.

“September was a tough transitional month for the industry,” said Mark LaNeve, GM’s head of U.S. sales. “As expected, the market returned to pre-‘cash for clunkers’ levels in September.”

The dismal talliescompare to an overall industry sales increase of 1% in August, when the government’s vehicle sales stimulus program offered vouchers of as much as $4,500 to trade in old cars for new ones. Roughly 700,000 new cars were sold as a result of the program, which finished in late August.

Analysts worried that the program would pull forward some sales that otherwise would have taken place in subsequent months; that scenario appears to have played out, based on these early results. Though August sales ran at a 14.1-million-unit clip, on an annualized basis, September’s annualized sales rate fell to scarcely 9 million, Ford said.

GM said it had calculated that a total of 200,000 sales that would have occurred later were pulled into the “clunkers” sales period. Of those, it said, 70,000 would otherwise have been registered in September.

Yet because August was so strong, the third quarter was turning out to be the best so far in this overall dismal year for auto sales.

Inventories, overloaded in the spring, are now stretched razor-thin, and dealers are beginning to complain that they have customers on waiting lists for some vehicles. Ford said its inventory dropped by 40,000 units during the third quarter, and GM said its total stock of cars and trucks on dealership lots was down 41% at the end of September compared with a year earlier.

Notably, sales of Ford’s F-series pickups were up 3.5% for the month, to 33,877 trucks sold, the second straight month of increases for the vehicles. Ford said mainly small businesses and individuals, rather than large companies, purchased the pickups, an important indicator of confidence in the construction and home-building markets.

Original article at LATimes New car sales slump after ‘cash for clunkers’ ends

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