No surprise: August's 21 percent auto sales drop, to the lowest level for the month in nearly 30 years, was dismal.
Last month's numbers were dragged down by comparison with August 2009, when sales soared because of cash for clunkers. And because inventories are low, carmakers didn't need to offer blockbuster incentives to clear dealer lots for the incoming 2011 models.
August's seasonally adjusted annualized sales rate dropped below 11 million units for the first time since February, to 10.8 million, according to the Automotive News Data Center.
But most analysts expect sales to return to the low- to mid-11 million range. So IHS Automotive left its fourth-quarter production forecast unchanged at 2.8 million, up 3 percent from a year earlier.
But manufacturer profits? That's a much better story than in years past -- even though sales continue to skid along near the industry's lowest levels in three decades.
The irony: The domestic automakers, which managed to lose billions of dollars when U.S. sales came to 16 million or more a year, now are largely turning a profit at an annual industry sales rate around 11 million.
How are they doing it?
Automakers are benefiting from customers' opening their wallets wider. Consumers are paying higher transaction prices and sometimes buying more vehicle than they were willing to a year ago. Sales of high-margin SUVs, crossovers and pickups are rebounding faster than sales of cars, especially small cars.
In addition, automakers' discipline is paying off. Cutting overhead and curbing overproduction have led to tighter inventories, smaller incentives and higher profit margins.
"It's all these things working in concert," said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. "It's almost like a symphony coming together, which allows us as an industry to actually be profitable at these lower volumes.
"If this discipline can be maintained, I would argue there's a whole lot of money to be made in this industry at a 15 or 16 million unit level," Schuster said.