US auto market decline

[Zef]

Detroit car sales set to be ‘worst since 1990s’
By John Reed in London

Published: June 30 2008 22:30 | Last updated: June 30 2008 22:30

June car sales data, due out on Tuesday, are expected to show the US auto market heading for its worst year in more than a decade.

The figures could also mark a milestone for Detroit’s struggling producers if they show Toyota outselling General Motors in its home market for the first time, although sales incentives recently introduced by GM could yet keep it ahead of its rival.

EDITOR’S CHOICE
Detroit’s Big Three keep eyes on cash - Jul-02Downsizing SUV drivers shift Mini sales up a gear - Jul-02Toyota stall keeps GM atop US sales rankings - Jul-01Chrysler plant closing reflects shift in demand - Jun-30Cerberus up for Chrysler challenge - Jun-19Small cars prove next big thing - Jun-20GM’s shares on Monday hit their lowest level in half a century as investors sold them ahead of Tuesday’s sales results.

As oil prices rise, household budgets are squeezed and Americans stop buying large vehicles.

Most forecasters and equity analysts expect annualised light-vehicle sales rates to reach barely 13m for June in the world’s largest car market, where last year sales exceeded 16m units.

“It’s not going to be pretty,” said Michael Robinet, vice-president for forecasting with CSM Worldwide.

“The consumer right now is undecided as to where fuel prices will go, whether their personal living costs will rise and, if so, by how much,” he added.

Credit Suisse on Monday predicted that the sales figures could be the “worst we’ve seen since the early 1990s recession, perhaps as low as the 12m range”.

The bank said it thought the number was more likely to be higher, but noted that even its forecast of 13.1m to 13.4m would still amount to an “unmitigated disaster by most measures”, given the rise in America’s population and vehicles that have been on the road since the early 1990s.

Most carmakers and forecasters entered 2008 with predictions that after a slow start, car sales would accelerate as Americans cashed their tax rebate cheques and the economy edged away from recession.

Soaring fuel prices have since precipitated a collapse in the market for pick-up trucks and sports utility vehicles, in which GM, Ford Motor and Chrysler are market leaders.

The rout is already being felt in America’s used-car market, where some dealers will no longer buy trucks.

Detroit’s three carmakers are shuttering capacity at large-vehicle plants and speeding up their small car programmes .

[john70t]

http://www.caranddriver.com/news/car_news/honda_and_toyota_models_top_mpg_chart_car_news
"Honda had the highest fuel economy of any manufacturer with 22.9 mpg, a slight decrease compared with its 2006 lineup. Toyota posted a 22.8 mpg average for its 2007 vehicles compared with 22.4 mpg the previous year. Toyota's gas-electric Prius hybrid had the highest combined fuel economy of any passenger car with 46.2 mpg."

A whopping 22mpg???
My 89 Civic hatch got 37mpg, and a Geo Metro got over 50mpg highway. The freakin' ModelT got 25mpg!
Build it and they will come. "They" aren't building it, or allowed to import it.

[widebody911]

Originally Posted by john70t

http://www.caranddriver.com/news/car_news/honda_and_toyota_models_top_mpg_chart_car_news
"Honda had the highest fuel economy of any manufacturer with 22.9 mpg, a slight decrease compared with its 2006 lineup. Toyota posted a 22.8 mpg average for its 2007 vehicles compared with 22.4 mpg the previous year. Toyota's gas-electric Prius hybrid had the highest combined fuel economy of any passenger car with 46.2 mpg."

A whopping 22mpg???
My 89 Civic hatch got 37mpg, and a Geo Metro got over 50mpg highway. The freakin' ModelT got 25mpg!
Build it and they will come. "They" aren't building it, or allowed to import it.

I think that's the average across the entire range of models, not just for a specific car.

[Danny_Ocean]

June Auto Sales Dismal

[john70t]

www.green.yahoo.com/blog/ecogeek/540/not-your-average-220-mpg-car.html 220mpg
http://en.wikipedia.org/wiki/Aptera_Motors 130 mpg

I guess these big automakers need a little federal-dollar bump?

[dd74]

Lately, I've seen fewer SUV commercials on TV.

[Joeaksa]

Originally Posted by dd74

Lately, I've seen fewer SUV commercials on TV.

And more from Honda... not that they were needed! Anything with 25 mpg or higher is going off of the showrooms right and left!

[Superman]

Just goes to show you.......management deserves credit for what goes right and we know who to blame for corporate bankruptcies.......it's the UNIONS!

[NICKG]

who said the unions were at fault?

[Porsche-O-Phile]

The unions certainly don't help, but in this case I agree - the short-sighted, opportunistic stupidity was management's fault. If I were one of GM's board members I can't say I'd have turned down the opportunity to re-badge a bunch of junky Yukons and Tahoes as "high end" SUVs and sell them to dumb suckers for 3X the price either, but you'd also have to realize that eventually the party would end and you better have a bunch of good, desirable, economical vehicles waiting in the wings "ready to go" the minute the "easy money" party ends.

That's where they failed. Bigtime. But I think ultimately the death of GM will be due to the unions and out-of-control pension obligations. Eventually they'll be bought out by someone else, probably Toyota.

[Superman]

Originally Posted by NICKG

who said the unions were at fault?

See above.

[JayG]

Its kinda sad that I was thinking about Packard, AMC, ....all old US automakers that arent around and then in 15 years is Ford going to be on that list? GM?

[onewhippedpuppy]

Originally Posted by john70t

http://www.caranddriver.com/news/car_news/honda_and_toyota_models_top_mpg_chart_car_news
"Honda had the highest fuel economy of any manufacturer with 22.9 mpg, a slight decrease compared with its 2006 lineup. Toyota posted a 22.8 mpg average for its 2007 vehicles compared with 22.4 mpg the previous year. Toyota's gas-electric Prius hybrid had the highest combined fuel economy of any passenger car with 46.2 mpg."

A whopping 22mpg???
My 89 Civic hatch got 37mpg, and a Geo Metro got over 50mpg highway. The freakin' ModelT got 25mpg!
Build it and they will come. "They" aren't building it, or allowed to import it.

Honda has a 22 MPG truck, 25 MPG SUV, and V6 Accord models to pull down that average. Though 22.9 seems low. Toyota makes sense, as they have the nearly 400 HP Tundra truck and Sequoia SUV, along with the low-20s Tacoma, and several mid-20s SUVs. On the other side of things, they both sell multiple 30+ MPG cars.

Supe, management is responsible for pushing the domestic makers into the water. Unions are the anchor around their necks, pulling them to the bottom.

I've seen talk of bankruptcy for both Chrysler and GM in the news recently. Layoffs everywhere, Chrysler cutting minivan production, major incentives to move product, etc. Poor planning and inferior product, probably not the best way to get through lean times.

[Jim Richards]

Studebaker

[NICKG]

Originally Posted by Superman

See above.

wel Supe..i hate to tell you this but Unons have run their corse here in the USA and are more a burden than a help...unless of course you are the uneducated , unskilled dolt who gets a gold lined parachute for working in one.

[the]

It's hard to imagine that Ford and GM will not at some point be forced into bankruptcy.

Ford's stock is almost in the $3 range. THREE DOLLARS.

They will file bankruptcy to be able to get out of union contracts, pension obligations, etc.

They are not well managed or well run companies, from everything from product planning to execution of the plan, but the deals they are in paying people way to much to do way too little (and even paying people to do nothing at all), ensure that they cannot continue to survive as they are.

[Superman]

Originally Posted by NICKG

wel Supe..i hate to tell you this but Unons have run their corse here in the USA and are more a burden than a help...unless of course you are the uneducated , unskilled dolt who gets a gold lined parachute for working in one.

Yeah? And I'm 100% confident that unions will exist when my granddaughter has grand kids. Unless of course, the gubmit does a sufficient job of protecting workers. Which won't happen. As long as management continues to make decisions with an eye on stockholders' interests.....there will be unions.

You're focused on wages and benefits being too high in the auto industry. As debt and inflation and other poor management decisions continue, and as "real" wages fall as a consequence, it will look more and more as though unions are at fault for throttling businesses with high wages and bennies. But to reach this conclusion, two things have to be ignored. One is the fact that unions occupy half the bargaining table. On the other side is management. Collective bargaining agreements require management buyoff and management signature. the other thing is that affluence is why wages rose in the first place. Reduce affluence and wages will look artificially high. That is what has happened, and will continue to happen.

[nut11]

Good point, Sup. In collective bargaining, the last time I looked, it takes two to tango. For the life of me though, I can't imagine the domestic industry couldn't see this coming. They've had had 30 plus years to adapt or at least hedge some bets w/ a selection of relatively high milers. However, the Euro autobahn cruisers and Toyota w/ the Tundra/Sequoia are caught w/their pants down too. And last, what's up w Chrysler offering gas cards as buying incentives??? A desperate last gasp attempt I guess. Ford for $3 bucks. Wouldn't touch it.

87 blk coupe

[Aerkuld]

Originally Posted by Porsche-O-Phile

...But I think ultimately the death of GM will be due to the unions and out-of-control pension obligations. Eventually they'll be bought out by someone else, probably Toyota.

Why would Toyota want them?
They already have an US dealer network and infrastructure. I hate to say this, but I think there may be car companies in other 'developing' parts of the world that may stand to gain a lot more by buying an existing US manufacturer, if you catch my drift.

Look at the Indian company Tata. Earlier this year they bought Jaguar Land Rover from Ford.

I think I've mentioned this before, the similarities of the US auto manufacturers situation to the decline of the British motor industry, and it just keeps coming back again and again.

Sad to see but probably inevitable.

[Porsche-O-Phile]

The threat of lawsuits is a far more motivating factor at ensuring workers are treated fairly than a union is. Unions are simply havens for slackers, do-nothings, deadbeats and skaters, more recently for illegals demanding even bigger slices of our country's pie (yes, I have first-hand specific examples if anyone wants them). The kind of person typically attracted to a union is the kind of person who would demand $100 from you, then b1tch and whine after you gave it to them that you didn't give them $200. You all know the type.

They have LONG outlived any usefulness they might have once had at giving workers a voice against management exploitation back in the time of Upton Sinclair's "The Jungle". There is simply no way, given how litigious a society we have now that such an era of robber barons could ever arise again.

If such-and-such a company gets a reputation for being unfairly tough on workers, people won't work there, or the company will need to pay a premium to attract talent. Amazing thing that free market. It even applies to labor! Who'da thunk it?