Remember the Johnny Carson-Ed McMahon bit that included the line, How hot was it? or How cold was it? or How (whatever) was it?
The answer was humorous, in keeping with the fast-paced Tonight show.
The same scenario could be used to discuss last years car and light-truck sales: How bad were they? The difference: There was absolutely nothing funny about the auto industrys 2008 meltdown.
The year started slowly and got worse as the months trudged by. Gasoline prices climbed above $4 a gallon last spring; that was a bullet in the brain for pickups and SUVs. Small cars were all the rage.
Fuel prices settled down, and Americans decided they didnt really like small cars after all. But they didnt return to pickups and SUVs. Many pickup sales had been to chest-thumping males who shouted: Im a real man. I drive a pickup.
George Pipas, Fords sales analysis chief, told me that 25 to 30 percent of pickups were bought by people who really didnt need a pickup. Pickup sales were down 26.2 percent last year.
SUVs? For years, I have been writing that SUVs were a fad that would fade like the yo-yo and the Hula-Hoop. Boy, did I take heat from SUV lovers for that prediction.
SUVs wont disappear from the market, but there will be fewer of them at the supermarket or the country club. And a lot of nameplates will fall by the wayside. At the end of last year, there were 45 of them.
SUV sales plunged 38.2 percent last year. Even the Cadillac Escalade was down. I guess General Motors ran out of professional basketball players to buy Escalades.
Greed does its thing
Next, it was the turn of the greedy bankers and stockbrokers to wreak havoc on the auto industry. They covered their backs with sable as they drove the housing market into burlap. People dont think much about new cars or trucks when they are in danger of losing their homes.
A federal handout of $700 billion -- with no strings attached -- bailed out Wall Street. Then the money people decided they would no longer lend money on automobiles unless the applicant could prove that he or she didnt really need the loan.
The auto business runs on credit. Dealers use credit to buy vehicles from the manufacturer. Consumers use credit to buy those vehicles from the dealers. No credit, no auto industry. And that was virtually the case during the fourth quarter of 2008.
High up in every monthly sales story I wrote was the line: It was the worst October (or November or whatever) since 1992, or maybe 1982.
Complicating the credit crunch, GM and Chrysler LLC no longer have captive finance companies. Cerberus Capital Management got Chrysler Financial when it bought Chrysler from Daimler AG in 2007, and Cerberus bought 51 percent of GMAC in 2006. GMAC is now a bank; GM will own no more than 10 percent of it.
About that $700 billion: It was a gift. No need to pay it back, guys. We pass it along to you because you are so important to the national economy. Compare that to the CEOs of GM and Chrysler, on their knees before the U.S. Senate, begging for a tiny fraction of that amount as a loan to keep their doors open. The Senate turned them down; President Bush and the Treasury Department came to the rescue.
Ford Motor Co., though mortgaged to the hilt, didnt need loans -- this time.
Bad to worse
What else can go wrong in the auto sector? I dont even want to think about it.
How sour was 2008? I mentioned the sales declines of 26.2 percent for pickups and 38.2 percent for SUVs. Minivans shed 23.9 percent of their 2007 sales, and big vans lost 23.7 percent. Crossovers were down 12.7 percent, and you can look for a thinning of nameplates there are 49 of them, which is simply too many.
Sales of every type of car declined, but the dips were smaller than among trucks. Small cars were down only 2.2 percent for the year, thanks to the $4 gasoline spurt. But they were off 29.0 percent in December.
Sales of midrange cars were down 11.5 percent for the year, and upscale models (near-luxury and luxury) fell 16.8 percent. Sporty cars just about matched that with a drop of 18.3 percent.
The new-car and light-truck market declined 18.0 percent last year. Cars were down 10.7 percent; trucks, 25.0 percent.