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Big 3's Auto Sales Plunge In November

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The Associated Press

The Tampa Tribune

Published: December 3, 2008

November's U.S. vehicle sales at General Motors and Chrysler plunged more than 40 percent, and Ford's sales dropped 31 percent, crushing hopes that the industrywide drop in vehicle demand might be easing as the U.S. automakers prepare to state their second case for a federal bailout.

GM's sales fell 41 percent, and Chrysler's dropped 47 percent.

Their overseas rivals posted abysmal results Tuesday as well.

Toyota's U.S. sales tumbled 34 percent, and Honda's fell 32 percent for the month.

Like retailers of other big ticket items, automakers have taken a beating in recent months as worries about the economy and unemployment have prompted consumers to slash spending. At the same time, some people afraid that they won't qualify for credit or that it will be too costly have put purchases on hold.

Many analysts had expected November's sales to come in slightly better, noting that aggressive incentive spending and the plunge in gasoline prices may have put a floor under sales. GM, Ford, Chrysler, Toyota and Honda Motor Co. all posted month-over-month sales declines, pointing to a potential industrywide drop.

Chrysler LLC said its sales decline included a 59 percent decrease in demand for cars and a 42 percent decline in truck sales.

Officials said the drops were partially a result of a 63 percent decline in fleet sales. Excluding such sales, the Auburn Hills, Mich.-based automaker said November's sales fell 36 percent.

Detroit-based General Motors Corp. reported a 44 percent drop in demand for cars, and light truck sales dropped 39 percent.

Mike DiGiovanni, GM's executive director of global market analysis, blamed GM's sharp sales decline on the global economic crisis and the credit squeeze.

"What we are facing is not a General Motors problem; what we are facing is an industry problem," DiGiovanni said in a conference call. "We are seeing further deterioration in the industry into November."

He aid the auto industry is in a worse state of recession than the broader economy, "and some might say bordering on a depression."

Jim Farley, Ford Motor Co.'s group vice president of marketing, said he expects the industry to post continued year-over-year declines in auto sales until at least the second half of 2009.

"We could see some strengthening in the second half of next year, or at least some stabilization, albeit at a much lower level," Farley said in a conference call with analysts and reporters.

Farley said sales began November at an improved rate but began skidding around midmonth with the Detroit Three's presentation to Congress for $25 billion in loans.

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