The Losers (And A Few Winners) In Dismal Auto Sales
When auto sales plunge 37%, it may seem like I'm piling on pointing out the auto makers who really struggled during the worst month for the industry in 27 years.
Conversely, you might be scratching your head to see me call anybody a winner in a horrible month.
That said, here is my list of those who showed promise and those who really stumbled last month.
January was horrendous. Just look at the sales numbers.
- Overall: Down 54.8%
- Chrysler: Down 68.9%
- Dodge Down 50.4%
- Jeep Down 49.2%
Yes, much of that decline can be blamed on Chrysler Financial going much of January without having the liquidity needed to offer competitive financing for dealers and customers. Still, sales have plunged so far one has to wonder what the future holds for Chrysler.
The country's number one auto maker still holds the title, but it's lead over Toyota took a big hit. Last month GM sold 128,198 vehicles compared to Toyota selling 117,287. A lead of 10,911. A year ago, the lead was 79,077. Yes, the dramatic drop in fleet sales plays a huge role in GM losing much of that lead and one month is still just one month (GM outsold Toyota by roughly 80,000 vehicles in December), but seeing the gap close is one that will get plenty of attention.
Any time a company can grow sales 14.3% when the industry is down 37% it has hit the right chord with buyers. That chord is the Hyundai "Assurance Program". The Assurance Program essentially lets return your new Hyundai to the dealership and get out of the remainder of your auto loan IF you lose your job in the next year.
I've had people e-mail me that this incentive is a rip-off because people who return their Hyundai are out of a car and the money they put down. Well, what is the alternative? If you bought a new car, lost your job and couldn't make payments, you would eventually have that car re-possessed and in the process trash your credit rating AND lose money.
Sure, these guys sell just a fraction of the new vehicles in the U.S. (1.9%), but you can't dispute they are doing something right. Sales were up 8 % last month. Oh you think these guys are a one trick pony who got lucky in a down month? Check out last year. Subaru was one of just three mass market brands (Mini and Smart) to grow sales in 2008.
The redesigned Forester is carrying the water right now with a look that is more conventional and less boxy. Given Subaru's limited line-up it is hard to know how long the auto maker can ride this wave, but give the company credit for growing in a down market.
- US Auto Sales Plummet to Near 27-Year Low
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