WSJ: US Vehicle Sales Worse Than Expected In April
02 Mai 2009 - 12:22AM
Dow Jones News
U.S. vehicle sales turned out even worse than expected in April,
muting optimism that the auto market is poised to rebound even with
General Motors Corp. and Chrysler LLC on the ropes.
Auto makers blamed the high-profile troubles at GM and Chrysler,
which sought bankruptcy protection on Thursday, for dragging down
sales last month across the industry.
"We've been fighting all these rumors left and right and it
doesn't help," GM sales chief Mark LaNeve said. "I thought we were
going to close much better than we did."
(This story and related background material will be available on
The Wall Street Journal Web site, WSJ.com.)
Shaky consumer confidence and high unemployment levels also
offset benefits of increased credit availability, deep auto
discounts and U.S. government backing of warranties on GM and
Chrysler vehicles.
April sales totaled 819,540 cars and light trucks, a decline of
34% from a year earlier, according to market research firm Autodata
Corp. The seasonally adjusted, annualized sales pace was 9.32
million vehicles, down from March's 9.86 million rate.
"Industrywide, April felt more like a dust bowl than a spring
garden for new car sales," Jim O'Donnell, North American president
for BMW AG, said in a prepared statement.
Every major auto maker reported dramatic declines from
year-earlier levels. Toyota Motor Co., with a 42% slide, fell
behind Ford Motor Co. in the monthly tally for the first time since
early 2008 even as Ford's sales fell 32%. GM sales dropped 33% and
Chrysler registered a 48% decline. Honda Motor Co. saw its U.S.
sales drop 25% and Nissan Motor Co. was off 38%.
Sales had gotten off to a solid start in April, but anxiety
around a Chrysler bankruptcy filing grew relentlessly. GM's plans
to exact more painful cost-cutting in its bid to survive also
contributed to the unease among car buyers.
The Obama administration has given GM until June 1 to present a
convincing restructuring plan or file for bankruptcy protection.
Chrysler is working to emerge from Chapter 11 in no more than two
months.
Chrysler Vice Chairman Jim Press denied that the auto maker's
troubles contributed to its sales decline. He said it stemmed from
reduced liquidity at Chrysler Financial.
Chrysler plans to take out full-page newspaper ads next week to
restore confidence among consumers, letting them know, "We're still
here," Chrysler sales chief Steven Landry said.
Auto makers have heaped on incentives, which increased by 29%,
or $680 per vehicle, last month compared to a year earlier,
according to car-shopping site Edmunds.com.
But deals weren't enough to help even healthier, foreign-based
auto makers. Toyota sales are off 38% year-to-date. The company
predicts 2009 auto sales will come in around 10 million sales,
which would mark a 24% decline from last year, when sales fell to a
15-year low. Toyota said Friday it plans to increase production of
select vehicles after inventory levels dropped to a point that
dealers stepped up orders.
"Although our April sales weren't much to call home about, there
are signs that the industry sales contraction is nearing its end,"
Toyota division executive Bob Carter said in a conference call. "We
are also encouraged by several economic indicators that point
toward a modest recovery."
While companies said they see signs of an impending rebound,
more turmoil lies ahead as GM and Chrysler race to remake
themselves. The auto makers recently announced plans to idle most
manufacturing for two months this summer in an effort to bring down
inventories.
GM, planning to shed its Saab, Hummer, Saturn and Pontiac
brands, is trying to clear out as many vehicles as possible. The
auto maker would have to buy back many unsold vehicles as
dealerships for those brands go out of business.
(Kate Linebaugh contributed to this article.)
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