NEWS ANALYSIS

An ice-cold August for auto sales

If you try hard, you might be able to find a bright spot in the August U.S. sales report. Aside from Nissan North America, Subaru of America and BMW's Mini, it won't be easy.

Nissan-Infiniti sales topped last August's by 13.6 percent. Mini posted an astounding year-over-year increase of 34.1 percent. Subaru was up 14.2 percent.

And you'd have to include American Honda Motor Co.; its August sales were fair. Since Chrysler LLC's sales were miserable, though, American Honda moved up to fourth place in the year-to-date ranking. It trails General Motors, Toyota Motor Sales U.S.A. Inc. and Ford Motor Co. Chrysler LLC is fifth.

Elsewhere, though, August offered more of the same gloom and doom that has stained the U.S. auto industry all this year.

August sales of new cars and light trucks totaled a puny 1,249,976 vehicles, down 15.5 percent from August 2007. For the first eight months of the year, the count was 9,800,814 units, 11.2 percent below 2007.

The industry considers 1.5 million sales an excellent month. In August 2007, sales were only a hair below that. But this year's deliveries fell 16.7 percent short of entering the charmed circle. The August sales tally was the lowest since 1998.

Automakers, desperately grabbing at any straw, noted that August sales were 10 percent higher than July's. But that's not unusual: August sales have exceeded the previous month's sales 10 times in the past 20 years.

The seasonally adjusted selling rate was 13.9 million vehicles last month, up a shade from 12.8 million in July.

Sad-sack Detroit

The Detroit 3 remained mired in futility in August. Sales of their domestic brands were off 24.7 percent from August 2007.

Every one of the Detroit 3's 13 brands reported a decline. Hardest hit was Hummer, which GM is trying to unload. Hummer sales were down 62.0 percent from August 2007.

Still, General Motors could take credit for the best performance by a domestic brand in August, although "least bad" might be a more appropriate phrase. Whatever description you apply, Saturn sales were down only 3.5 percent last month.

Overall, sales of GM's domestic brands were down 20.1 percent last month; Ford Motor's domestic brands fell 25.5 percent; and Chrysler LLC was 34.5 percent below its August 2007 total. The Detroit 3's market share plunged 5.6 percentage points, to 45.3 percent. It is no longer news that the domestic companies had less than half the market.

Yet aside from Nissan North America and Subaru, the Japanese had little to beat their chests about either. All the other Japanese automakers lost sales in August, including the two giants, Toyota Motor Sales and American Honda. August was the fourth straight month that Toyota Motor Sales failed to match its year-ago performance.

Pickup giveaway

Trucks had another hard time in August, without $4-a-gallon gasoline to blame. Sales of full-sized pickups plunged 24.6 percent despite huge incentives. Sales of big pickups were higher in August than in July, but anyone who thinks a comeback is under way is kidding himself.

Rather than selling full-sized pickups, automakers are engaged in a massive giveaway derby for any customer who will take one off a dealer's lot. Chevrolet and GMC gave the trucks away at dealer cost, with the factories sending dealers a few bucks for doing the paperwork.

Ford is advertising discounts of as much as $9,000 on the F series, the nation's best-selling nameplate for 30 years. Dodge Rams carry a $6,000 rebate. Toyota has placed $4,000 on the hoods of Tundra models.

An August surprise: The Chevrolet Silverado pickup topped the list of best-selling vehicles. The Silverado trounced the Toyota Camry and Honda Accord mid-sized cars. Ford's F series was fourth.

SUVs are in the same leaky boat as big pickups. SUV sales were down 34.4 percent in August and 33.1 percent for the year to date.

Automakers have sold 467,441 fewer new SUVs this year than last. At transaction prices of $25,000 to $30,000, that is $12 billion to $14 billion worth of business that dealers have lost.

Sales of small cars fell in August, but short supplies were a factor. Their sales slipped 6.2 percent in August but were up 8.2 percent for the year. Small cars are the only market segment that shows a gain this year.

You can reach John K. Teahen Jr. at autonews@crain.com

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