Bad September for GM & Chrysler
With the artificial loading of the “Cash For Clunkers” program in August, sales of Chrysler, Ford, and GM shot up dramatically, considering the state of the economy.
Alas, the chickens have come home to roost.
Overall, U.S. auto sales dropped by 23 percent in September compared to the previous year. GM dropped by 43 percent and Chrysler was down 42 percent. Showing greater strength, Ford managed to hold its sales decline to 5 percent.
Of the three, Ford is the only American automaker that escaped bankruptcy and the only one that did not beg for government bailout money.
The poor September performance can be partially explained by the August “Cash For Clunkers” spike. On the other hand, auto sales last September had also dropped precipitously, lowering the comparative sales point.
Reuters stated, “Sales in September 2008 were rocked by the collapse of Lehman Brothers and the financial crisis, events that pushed both GM and Chrysler to seek a federal bailout. With consumer uncertainty rising, sales in September a year earlier had dropped to a 12.2 million unit rate.”
Things project for a comparatively brighter future for Ford. According to Reuters, Ford said it would step up its leasing program with dealers. Analysts said they expected the No. 2 U.S. automaker was poised to take more share from its rivals in the months ahead.
“In the short term, I don’t see much of change for GM and Chrysler in terms of sales declines. The No. 1 reason really is their product lineup,” said Jesse Toprak, an analyst at Truecar.com.
“The bigger question is whether they can restructure themselves to make money at lower sales levels — it’s going to be tough, obviously,” he said.