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US Light Duty Vehicle Sales Continue Decline in July

1 August 2008

July08sales1
The SAAR for US light-duty vehicles dropped to 12.55 million in July. Click to enlarge.

US sales of light-duty vehicles continued their decline in July, dropping to a total 1.136 million units, a 13.2% reduction in volume compared to July 2007, according to Autodata. The seasonally adjusted sales rate (SAAR) dropped to 12.55 million units. July 2008 had two selling days more than July 2007 (26 vs. 24).

The year-on-year decrease came, in general, out of the light-duty truck segment. Sales of cars in July 2008 slightly increased 0.3% on a volume basis (not on a day-sales rate) to 620,213 units, according to Autodata. Light truck sales, however, dropped 25.2% by volume from the year before to 515,963 units. The car-truck ratio for the month was 55:45, the fifth consecutive month cars have held the majority of the new light vehicle market.

July08sales3_2
In July, car sales held the majority position for the fifth month running. Click to enlarge.

GM. GM’s total sales in July dropped 26.7% by volume, reflecting a 34.7% drop in light trucks sales to 128,005 units and a 12.1% decline in car sales to 105,335 units. The Malibu, now GM’s top-selling car, posted a 78.6% increase in sales year-on-year to 16,637. Sales of the Cobalt, GM’s second top-selling car in the month, climbed 3.5% to 16,410 units.

GM also announced a preliminary second quarter net loss of $15.5 billion, including significant charges and special items, compared with net income from continuing operations of $784 million in the second quarter of 2007.

The second quarter adjusted automotive loss of $4.0 billion ($9.1 billion reported) reflects the losses in GM North America (GMNA) driven largely by volume declines including the impact of the American Axle and local strikes as well as adjustments to lease vehicle residual reserves. In addition, GMAP results were negatively impacted by adjustments relating to hedge accounting. The losses were partially offset by strong performance in the GMLAAM (Latin America, Africa & Middle East) region and continued profitability in GM Europe. The loss compares with adjusted automotive earnings from continuing operations of $1 billion in the second quarter of 2007 (reported earnings of $803 million).

July08sales4 July08sales5_3
US car and light truck sales in July 2008 for top 6 vendors. Click to enlarge. Change in US car and light truck sales for top 6 vendors from July 2007 to July 2008. Click to enlarge.

Toyota. Toyota reported an 11.9% decrease in sales by volume in July 2008 to 197,424 units. Passenger car sales declined a slight 0.6% by volume to 128,099 units. Truck sales dropped 28.8% to 60,362 units. Sales of the full-size Tundra pickup were off 42% to 13,413 units.

Toyota’s top gainer amongst its passenger cars was the Corolla, with a 15.9% increase to 34,438 units. The top-selling Camry, including the hybrid version, rose a modest 1.5% to 42,131 units.

On the hybrid side, Toyota said it continued to be hampered by availability, with the Prius posting 14,785 units for the month, and the Camry Hybrid 2,645, out of a total of 20,363 hybrids sold.  Toyota’s total hybrid sales in July dropped 11.9% year-on-year.

Ford. Total Ford, Lincoln, and Mercury sales dropped 13.3% to 156,406 units. Within that, however, passenger car sales increased 7.8% in July, climbing to 57,177 units. On the truck side, crossover sales declined 7.8% to 27,336 units; SUVs plunged 54.4% to 10,213 units; and trucks and vans dropped 18.1% to 61,680 units. Total light truck sales were 99,229 units, a decrease of 22.1%. The Ford Focus was the company’s top-selling car in July, with a 15.6% increase in sales year-on-year to 15,200 units.

Honda. Honda’s total sales dropped 1.6% by volume in July to 138,744 units. Total car sales increased 14% to 90,943 units; total truck sales dropped 22% to 47,801 units.

The Accord was the top-selling car, with an 11.4% increase to 41,382 units, followed by the Civic with a 4.6% increase to 29,125 units. The Fit almost doubled its sales, jumping 93.3% to 12,266 units.

Chrysler. Chrysler LLC sales dropped 29% in July by volume to 98,109 units. Passenger car sales dropped 25% to 25,839 units; truck sales dropped 30% to 72,270 units. Chrysler’s sole major gainer was the Town & Country van, which increased its sales 24% to 8,070 units in July.

In discussing its second quarter and first half performance, Chrysler said it nevertheless remained ahead of its financial plan primarily due to restructuring. For the six months ended June 30, 2008, Chrysler posted an EBITDA of approximately $1.1 billion.

Nissan. Nissan sales increased 8.5% in July to 95,319 units. Nissan car sales increased 2.4% to 55,720 units. Bucking the overall trend, Nissan’s truck sales increased 18.3% to 39,599. The Altima, including the hybrid model, posted a slight decrease of 0.1% to 24,429 units, but remained the top-seller. Nissan posted strong gains with its Versa (up 14.4% to 8,701 units) and the Sentra (up 16% to 10,977 units). On the truck side, the Frontier was the top seller, with a 24.3% increase to 6,627 units.

August 1, 2008 in Sales | Permalink | Comments (13) | TrackBack (0)

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I have submitted your article to http://www.autocar-live.com which is a social site where users can submit car/auto articles and vote for already submitted articles. Register and vote for the article to appear on the frontpage at http://www.autocar-live.com/upcoming.php

The other shoe drops. The era of small egos riding in big trucks is over. At least the market price for trucks has fallen, and people who NEED them get a bit of a price break. I guess we're going to find out how many really need a truck.

Percentages are sometimes deceiving. Obviously if you only sold 5 cars last year and then sold 10 this year, your numbers look impressive.

What stood out for me, was that Toyota, despite it's shortages, sold more hybrids than GM sold Malibus, it's best selling car.

Image:

July08sales4

does not work properly.

Image repaired. thank you.

High fuel price and foreseen costly wars and bad loans driven economic slow down are driving the downward trend for most unjustified gas guzzlers.

How long will this situation last? Another 2 or 3 years or more?

Will oversized gas guzzlers sell again when gas price stabilizes and business picks up again?

Will Hybrids or PHEVs or BEVs (or all three) drive the next upward market?

Will GM, Ford and Chrysler adapt to the new realities or fold?

Will Renault-Nissan, with their recent push towards BEVs, be the next leader or Toyota and Honda with their more balanced approach?

When will EU manufactureres switch from diesels to hybrids, PHEVs and BEVs?

Challenging times ahead for the Big 3s.

I would love to know what percentage decrease is due to a decrease in leases. I read in the NY Times that auto makers are starting to cut back on leases, esp on the big trucks. While consumers who leased SUVs and can now turn them back in to the dealer and walk away from them, it turns out that this was not such a great deal for the manufacturer and they are less willing to do leases now for this reason. I think leasing has artificially increased auto sales for many years because people have to come back after three years or so and get another car. People who buy a car tend to hold onto it a longer time, decreasing overall sales. They also tend to buy less expensive cars and take into consideration the overall cost of ownership. No surprise the Corolla and Fit posted gains. These cars are fuel efficient, inexpensive to buy and generally reliable.

Peter,

I doubt leasing changes had much effect on depressing these results, since the changes were only very recently announced, and won't start to effect results until 1 August. Leasing probably bulked up historic volumes - that was the point of them - and encouraged consumers to choose more expensive vehicles.

Harvey,

The near-term winner is going to be the company that can produce lots of affordable small cars. Mostly non-hybrid - just good, efficient 4 cyl cars. Obviously Honda, Toyota and Nissan are way ahead on that. Question is how quickly can GM/Ford/Chrysler get into that in large volumes.

Longer-term, we have a technology race of hybrids, PHEVs, BEVs, alternate fuels, etc, etc. Earlier posts imply Europe may back away some from diesel as the emissions costs to meet Euro 5/6.

It won't be boring.

Shane

I looked at the big 3 annual car sales and unless I miss my guess, they all 3 total less than 50% of the cars sold in the U.S.

There were about 3 million for GM, 2 million for Ford and 1 million for Chrysler. That is 6 million out of the 14 million estimated to be sold in the U.S. in 2008. At this rate annual vehicle sales have gone from 16, to 15 to 14 million and still declining.

I saw a Ford ad the other day offering employee prices on f150s PLUS another 6 grand off. That's like, I don't know, ten grand off? With that kind of money, you could buy a lot of gas. At least people who need trucks are getting a pretty good deal. Of course, ten grand is only two years worth of gas in one of these, so...

Interestingly, Ford--who has an excellent small-car product line from their well-regarded European division--stands to hugely benefit from the switch to smaller cars over the next few years. I expect Ford to spend a lot of engineering research to make their Duratorq turbodiesel engines meet the CARB 2009 emissions standard (equivalent to EPA Tier 2 Bin 3), which could mean Ford could have a full line of very fuel-efficient vehicles by 2010.

shane, you might want to know that there's now extensive research into cleaning up diesel engines to meet the new US standard without the complication and expense of urea gas injection into the exhaust stream, mostly by using a modern form of exhaust gas recirculation (EGR) that won't affect engine performance like EGR systems did in the past. In fact, once turbodiesel engines meet the new US standard, I expect them to be very popular, since diesel fuel can come from non-petroleum sources such as cellulosic biomass processing or oil-laden algae.

The fact that Ford is going to start selling its european vehicle line in the US is a very intereting development. The vehicle industry seems to be rapidly changing. I will be very interested to see how the aptera does later this year.

It is too bad that Toyota has not found a way to increase the availability of their metal hydride batteries. Perhaps this is a perfect opportunity to agressively pursue lithium ion technology. I also would like to remind the people that really want to buy a big pick up truck (new home owners frequently talk about how much they need a pick up truck to transport heavy items) that you can rent a Ford F-350 at Home Depot or Lowes for less than $30 if you can transport your items within 75 minutes! Additionally, you don't have to pay for the gas!

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