The auto industry has begun 2009 about where it left off in 2008. That would be somewhere in a ditch on the side of the road.
The Big Three U.S. auto makers on Tuesday reported January sales figures and they were awful: Chrysler LLC led the way, with its vehicle sales plunging 55%; General Motors reported a 49% decline; while Ford said sales fell 40%.
Elsewhere in the industry, Toyota’s sales fell 32% for the month; Nissan’s dropped 30%; Mercedes’ 36%; Honda’s 28%; Volkswagen’s 11.6%.In addition to lackluster consumer sales, sales to big volume buyers such as rental car companies have all but dried up, the companies reported.
The industry has reported at least a 30% decline in U.S. sales every month since October.But Subaru, a company that has focused on smaller, more fuel efficient cars, bucked the trend of declines for a second month in a row, posting an 8% sales increase, and Hyundai said its sales jumped 14%.Hyundai’s sales were likely boosted by an unprecedented program in which buyers who lose their income within a year of purchase can return the car.
“There are still a lot of tough times ahead,” said David Magee, an expert on the U.S. car industry and author of How Toyota Became #1.Magee said the U.S. car makers brought a lot of their troubles on themselves by making too many cars during the past decade.
The surplus has created a glut of used cars, and consumers have figured out that it’s far cheaper and makes more sense economically in the current difficult environment to buy a used car than a new car.Click here for more on this story from FOX Business Network