GM, Chrysler Woes Weigh On Industry; Recovery Hopes Delayed
01 Mai 2009 - 10:57PM
Dow Jones News
U.S. vehicle sales were worse than expected in April, muting
optimism that the beleaguered auto industry is poised to rebound
even amid turmoil at General Motors Corp. (GM) and Chrysler
LLC.
Auto makers blamed 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."
Shaky consumer confidence and high levels of joblessness also
offset benefits of increased credit availability, deep discounts on
cars and trucks and U.S. government backing of warranties on GM and
Chrysler vehicles.
Light vehicle sales in April were about 820,000, down 34% from
the year-earlier month and 4.5% from March, according to data
released late Friday by Autodata Corp. That put the annual selling
rate at 9.3 million vehicles.
"Industry-wide, April felt more like a dust bowl than a spring
garden for new car sales," Jim O'Donnell, president of BMW in North
America, said in a statement.
Every major auto maker reported dramatic declines. Toyota Motor
Co.(TM), with a 42% slide, fell behind Ford Motor Co. (F) in the
monthly tally for the first time since early 2008. GM sales fell
34% and Chrysler sales were down 48% from a year ago. Honda Motor
Co. (HMC) sales were down 25% and Nissan Motor Co. (NSANY) fell
38%.
Anxiety around Chrysler's bankruptcy filing and GM's plans to
exact more painful cost cutting in its bid to survive helped drag
sales down toward the month's end and erased a strong start to
April.
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 the auto maker's
troubles contributed to its sales decline. He said the decline
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 have now fallen 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.
While companies said they see signs of an impending rebound,
more turmoil lies ahead this spring 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 of those brands go out of business.
-By Sharon Terlep, Dow Jones Newswires; 248-204-5532;
sharon.terlep@dowjones.com.