For U.S. automakers, July was the darkest month in the 102-year history of the automobile business in the United States.
For the first time, foreign manufacturers controlled the market. The import-badged cars and trucks captured 51.9 percent of the market, leaving only 48.1 percent for the domestic brands of General Motors, Ford Motor Co. and the Chrysler group. A year ago, the domestics had 52.0 percent of the July market.
In raw numbers, the score was: Imports, 679,523; Detroit 3, 629,569. The domestic brands still hold the lead for the year to date. Seven-month market shares were 51.4 percent for the Detroit 3 domestics and 48.6 percent for the import-badged brands.
Still, sales weren't great for the imports, either. Auto sales wilted for just about everybody in July. For the month, total sales fell 12.4 percent.
Withered by high fuel prices and blistered by consumers strapped for cash because of rising mortgage rates, five of the big six automakers lost ground in July. Only Nissan eked out a small gain.
Not even Toyota Motor Sales U.S.A. Inc. and American Honda Motor Co., which seem to always prosper in good times and bad, could buck the July drought. Both jacked up their incentive spending, but suffered sales declines anyway.
As usual, the news was the worst for the Detroit 3:
- General Motors: down 22.3 percent
- Ford Motor Co.: down 19.2 percent
- the Chrysler group: down 8.4 percent
Toyota was off 3.5 percent from a year ago, while Honda's sales fell 3.2 percent. But the results might have been much worse had it not been for incentives, which were way up for both automakers in July.
"We are seeing combined incentive spending for Japanese automakers reach record highs," said Jesse Toprak, executive director for industry analysis for Edmunds.com, an industry research firm.
In July, Toyota's average incentive spending per vehicle totaled $1,492, up nearly 50 percent from July 2006. Honda, which typically shies away from cash payouts, spent an average of $1,146 per vehicle on incentives, up nearly 30 percent from a year ago. Nissan's July incentives of $2,290 per vehicle topped the Asian automakers but were down about 12 percent from a year ago.
Still, the Detroit 3 led the league in givebacks in July by a wide margin. The Chrysler group averaged $4,082 per vehicle, up from $2,623 a year ago. Ford's average of $2,984, was down sharply from $3,888 in July 2006 and was best among the Detroit 3. GM, with an average of $3,130, was down nearly 20 percent over a year ago.
Ford sales analyst George Pipas said declines in both daily rental fleet and retail sales contributed to the big drop.
"Obviously, the magnitude of the decline in July is fairly substantial," Pipas said.
He said softer industry sales are a concern, but Ford will stick with its plans rather than unilaterally lowering prices to spike consumer interest.
"Sometimes you just take your medicine and get on with it," Pipas said.
August doesn't look sunny
GM had almost no bright spots, and no indication that August will be any better than July. With the exception of the Saturn Aura, Pontiac Solstice and Cadillac DTS, sales of all of GM's car lines were down. For GM's bread-and-butter pickups, the Chevrolet Silverado fell 26.5 percent, and the GMC Sierra was off 28 percent.
Only GM's new trio of mid-sized crossovers, the Saturn Outlook, GMC Acadia and Buick Enclave, had any traction in July. Combined, the three stylish crossovers sold 12,080. The sales are encouraging for GM because the crossovers are moving off showroom floors despite low incentives, and production is just now ramping up.
Paul Ballew, GM's executive director of market and industry analysis, said, "We didn't have a terrific retail month for sure, but it's better than June."