US auto sales continued to slip in September amid an industry slowdown sparked by economic uncertainty and massive production cuts at struggling US automakers.
The Big Three US automakers took a hit from planned reductions in low-margin sales to rental car companies, as they downsized operations to better cope with a steady loss of market share to Asian rivals.
Results were mixed elsewhere as some consumers, unnerved by a credit crunch and a housing market slump, looked for incentives or postponed purchases. Luxury vehicle sales, however, were generally strong.
US automakers commanded 50.8 percent of the market in September while Asian brands held 42.1 percent and European brands saw their share climb to 7.1 percent, according to Autodata.
General Motors Corp nonetheless managed to increase sales 3.8 percent to 337,640 vehicles on the back of strong consumer demand for its new lineup of cars and trucks.
“GM's success for the last couple of months is another sign that if you come up with compelling products and design and price them right you will still perform well even in a weak market,” said Jesse Toprak, director of industry analysis at Edmunds.com.
Chrysler LLC and Ford Motor Co. did not fare as well, with Chrysler's sales down five percent to 159,799 vehicles and Ford dropping 21 percent to 189,863 units.
The slump at Ford allowed Toyota to overtake its US rival again as the number two automaker in the US, despite the Japanese automaker's third month of losses as its sales slipped 0.6 percent to 213,043 vehicles.
Toyota commanded 16.2 percent of the US market in September which Ford held just 13.3 percent, according to Autodata.
While Ford maintains the lead on year-to-date sales – 16.8 percent compared to Toyota's 15.2 percent – Toyota's lead going forward seems certain, Toprak said.
“Ford will never be able to catch up with Toyota,” Toprak said in a telephone interview.
American Honda Motor Co. posted record September sales of 127,200 Honda and Acura vehicles, up 13.8 percent following strong demand for its new Accord sedan.
Mercedes Benz also had a record-breaking month with sales up 13 percent at 22,459 vehicles.
Nissan saw sales rise 11 percent to 94,269 vehicles while Hyundai Motor America sales rose 2.5 percent to 33,214 units.
GM applauded its results, noting that its retail share, which has been stable for two years, improved in the third quarter.
“Our market share performance of more than 25 percent over the last quarter demonstrates strong consumer acceptance of our new products and the continued progress we've made in our North America turnaround strategy,” said Mark LaNeve, GM vice president for North America vehicle sales, service and marketing.
“For the second consecutive month, we posted good retail volume despite a challenging industry.”
Toyota said it was hard to beat last year's record-breaking sales, adding that it expected the overall industry to improve slightly in the coming months.
“Given September's economic headwind, the industry saw a fair month,” said Jim Lentz, executive vice president of Toyota Motor Sales USA.
“The fall selling season is likely to benefit from increased stabilization and modest gains.”
Ford said its sharp drop in sales was a “below par” performance in a weak overall market but noted strong sales for new “crossover” sports utility vehicles.
“We are still on track to achieve both our market share objective: both total retail and total fleet (sales),” George Pipas, Ford's US sales analysis manager said in a conference call.
“Overall for the year to date (we have) 13 percent of the retail market and that's the basis of our business plan for 2008.”
Chrysler blamed much of its losses on a plan to cut fleet sales to rental car companies and said its retail sales “remain strong.”
“Our fleet sales continue to trend down more than 20 percent driving the overall sales decrease for the month,” said Darryl Jackson, Vice President of US Sales.
“This is directly in line with our plan to reduce daily rental fleet during the second half of the year.”
