DETROIT | Chrysler‘s U.S. vehicle sales plunged 55 percent in January, while General Motors Corp.‘s tumbled 49 percent and Ford Motor Co.‘s dropped 40 percent, setting an abysmal pace for the whole auto industry as lower sales to fleet buyers also weighed down the results.
Toyota’s sales dove 32 percent for the month, Nissan’s dropped 30 percent and Honda’s fell 28 percent, putting the overall industry on track for its fourth straight month in which U.S. sales plunged 30 percent or more.
But Subaru bucked the trend of declines for a second month in a row, posting an 8 percent sales increase, and Hyundai said its sales jumped 14 percent.
Hyundai credited its increase to its offer to cover a new vehicle’s depreciation if customers return a car within 12 months because they are unable to make the payments.
“This program gets to the root cause of today’s economic concerns - fear of job loss,” said Hyundai regional General Manager Peter DiPersia.
Chrysler’s sales chief, Steven Landry, told reporters earlier at a meeting with dealers that U.S. industry sales could drop as much as 35 percent in January. The annualized sales rate for the month could drop below 10 million for the first time in more than 26 years, he said.
According to Ward’s AutoInfoBank, the last month in which the seasonally adjusted annual sales rate dropped below 10 million was August 1982, when it dipped to 9.9 million as the nation was mired in a recession.
Domestic and foreign automakers have been struggling as unemployment rises, consumer confidence weakens and many people have a tougher time getting loans. GM and Chrysler have received $13.4 billion in federal loans to stay afloat, and they hope to get more after they submit a viability plan to the government by Feb. 17. Ford has said it does not plan to use government aid.
GM said last month it is planning its turnaround under the assumption the entire industry will sell 10.5 million new vehicles in the U.S. this year. Chrysler has said it’s planning on 11.1 million units, and Ford last week reduced its forecast to a range between 11.5 million and 12.5 million. But few people were expecting the automakers to start 2009 at such a pace.
January is typically a slow sales month, and many automakers and analysts are expecting the market to rebound in the second half of the year as the economy and access to credit improves.
GM sold 128,198 light vehicles in January, while Ford’s sales totaled 93,060 and Chrysler sold 62,157. Toyota Motor Corp. sold 117,287 cars and trucks.
The automakers have rolled out hefty incentive offers to boost sales. Edmunds.com estimated the average automaker incentive at $2,714 per vehicle sold in January, down 5.2 percent from December but up 12.5 percent from January 2008.