Vehicle Sales Plunge
By Barry Ritholtz - February 3rd, 2009, 2:05PM
Ouch:
• Ford Jan vehicle sales were down a greater than expected 42.1%.
Ford’s fleet sales tumbled 65%,• GM vehicle sales fell 49%, greater than the consensus of a decline of 39%.
• Toyota reported a 32% drop;
• Honda sales fell 27.9%
• Nissan reported a 30% decline;
• Mercedes-Benz division dropped 43%;
• Porsche sales skid 36%
• Volkswagen AG reported its U.S. unit’s sales fell 12%;
February 3rd, 2009 at 3:06 pm
The world is having a synchronous buyer’s strike…
Worldwide countries are having simultaneous decreases in both imports and exports…
http://www.rttnews.com/CorpInfo/EconomicCalendar.aspx
I posted this earlier on the Cafe, but look at Korea and Switzerland…
The point…this is already worse than the early 80’s…car sales in Europe have plunged as have sales in Japan….this is going to be very serious…the Brits and Europeans call it registrations, but I use this site to see what the rest of the globe is doing while we stew and storm around…and we are all globally sub-prime now..
February 3rd, 2009 at 3:09 pm
Hmmmm.
Would those numbers reflect the fact that in January I bought a ‘97 Honda Accord LX station wagon with 76,000 miles (one little old lady owner) for $4,500 so that my college freshman daughter could have my ‘04 Civic 2-door with 78,000 miles (one owner wife-couldn’t-learn-to-drive-stick-shift) I bought last summer for $7800?
Plan on keeping the Accord until my 96-yr old mom gives up her driver’s license (finally) and sells me her ‘04 Prius with 24,000 miles.
Automakers around the world, don’t hold your breath for my next purchase of a new vehicle.
Now I would consider a light-weight pick-up, hybrid with 50-mile plug-in range/capability, but then I’m not going to hold my breath for that.
February 3rd, 2009 at 3:10 pm
I’m hoping for a new round of incentives. Zero percent financing, or large cash rebates, or maybe a ridiculous act of Congress to give people a tax incentive to buy a new car.
If the price is right… I’ll buy.
February 3rd, 2009 at 3:10 pm
Never been a better time to buy or sell a car………until you realize the world has been and continues to be overpriced in a rapidly deleveraging/deflating economic environment. Consumers are finally acting rational again and that rational behavior will ironically make things worse in the short term.
February 3rd, 2009 at 3:23 pm
Last spring, I had a conversation with someone who has interests in Florida VW dealerships. I quizzed this person how his business was, given that South Florida was tanking. His take was that nothing was wrong and his business had seen no contraction. He thought the negative economic talk was all hype from the press due to the upcoming election. I wonder if he still feels that way today??
February 3rd, 2009 at 3:37 pm
Here in Frogland 149.385 units sold in January quantifying a decrease of -7.9% (however, with the open days comparison only -3.5%)
French companies average -14.8% (Renault/Peugeot)
Fiat +15.7%
Mercedes +12.4%
Ford +5.9%
Volkswagen +4,3%
BMW -21.4%
GM Europe -17.4%
Toyota (with Lexus) -8.7%
It is to be said that the French government gave a 1000 euros subsidy for trade in over 10 years of age trowing 2 stones at once boosting sluggish sales and improve emissions. So far it’s holding up.
February 3rd, 2009 at 3:42 pm
“His take was that nothing was wrong and his business had seen no contraction.”
Unless you want a bullshit answer, never ask a businessman how business is–especially someone in the car business.*
*If you are the government with a wad of TARP cash stuffed in your pocket, you can expect the businessman to lie about how bad it is.
February 3rd, 2009 at 3:59 pm
If you work for someone other than yourself and don’t have the cash on hand, why in the world would you feel like your employment was safe enough to buy a new car?
February 3rd, 2009 at 4:02 pm
“Consumers are finally acting rational again and that rational behavior will ironically make things worse in the short term.”
Finally, some positive news. After so many years of mortgaging their lives away on new cars, homes, toys, etc. and saving nothing, the American consumer is finally realizing that snake bites. This adjustment to the U.S. economy was long overdue and will be painful, but needed. As they realize their retirement nest egg, based on the false belief that home values would never drop, has disappeared and they finally realize they will have to do something different to protect themselves. Business’ that expanded to meet that short-sighted view are now having to contract to normal spending habits and the financial world is pumping out the rhetoric to try and get them back into that same bad, never ending loop (Buy! Buy! Buy!).
February 3rd, 2009 at 4:02 pm
9 years ago, while working in the Bahamas, the taxi that I used for 2 years (the only one on the island) was a diesel mini-van (wished I remembered the brand). The only car I would buy new would be a break-through like this, because I keep cars for a long time. Somehow long-lived cars like this are never be sold in the US. Something fishy going on here. The car companies arrogance towards their customers are sealing their fates.
February 3rd, 2009 at 4:22 pm
@The Curmudgeon:
Duly noted.
February 3rd, 2009 at 4:28 pm
Just bought 2 new vehicles – first ones in 8 years. Chevy diesel 3/4 ton for my business and a Toyota Rav4 for the bride. Paid less for the new truck than I paid for the 2001 version of the same exact thing. The dealership took $10,000 less than they sold that truck for 12 months ago. The Toyota had a smaller discount, relatively speaking, but still ~$3,000 less than it sold for 9 months ago.
Great time to buy a vehicle – BRUTAL time to be selling them.
February 3rd, 2009 at 4:51 pm
I am driving a loner Audi an A4 Diesel. it
I was told it has a consumption of 7 liters for 100KM in town or 1.85 US gallons for 62.1 miles and 6 litters at 130Km/h the top legal highways speed or 1.58 US gallons for the same 62.1 Miles however, driving at 85 miles per hour.
Further, all Japanese vehicles can be bought with a diesel engine including lexus, infinity and the likes
February 3rd, 2009 at 5:13 pm
@deanscamaro
“After so many years of mortgaging their lives away on new cars, homes, toys, etc. and saving nothing, the American consumer is finally realizing that snake bites. ”
I think so too and I wonder how much of this mind shift is due to using Heloc $ to buy (or pay off) the family cars? People have learned that it is just an awful waste to finance a car. I bought a brand new car with financing once and never made that mistake again. I think millions know this. And it is pretty much the case in markets where car ownership is increasing. For example, in China – the number 2 car market in the world and fast growing still – most car sales are settled in cash despite great lengths to induce Chinese to finance and creating an auto finance industry including securitization. The most recent number I know is from a JD Power report in 2007 that said that only 10% of car buyers in China financed the purchase.
February 3rd, 2009 at 5:25 pm
Hmm.. VW has the most comprehensive line of diesel autos in the US, and its sales are the least impacted on this list.
Correlation but not causation?
(That said, I would never be the sucker to take the depreciation hit on a new car, let alone the ridiculous insurance rates for the kind of gold-plated insurance that financing requires…)
February 3rd, 2009 at 7:17 pm
How bad do you have to be to accomplish a 49% decline in business??
I wonder if any retard of the street could do much worse. Are they even trying?
Auto bailout part II coming sooner than “anybody” could have guessed. Just make sure the people at the top get a nice bonus first.
February 3rd, 2009 at 9:13 pm
the car business is nothing but the canary in the mine. it has been showing this same sign for almost a year. its the sign that consumers (AKA employees) are tapped out. and their wages haven’t kept up with inflation to the point that they make less than the did in the 70s. and since credit has dried up for them they can’t make up for their low low wages. so why are we surprised that cars aren’t selling? and lots of other big ticket items aren’t selling? the consumer (employee) is in their shell and will only spend money on things they have to have (like food), and every thing else is put on hold until it can’t be denied any more. if this doesn’t change, then there are no business that can survive for very long as we will be heading for levels not seen since the 70s (or maybe worse).
February 3rd, 2009 at 11:05 pm
@Bruce N Tennessee Says: February 3rd, 2009 at 3:06 pm
Fantastic data link there. I’ve been looking for something like that
Finally, some positive news. After so many years of mortgaging their lives away on new cars, homes, toys, etc. and saving nothing, the American consumer is finally realizing that snake bites. This adjustment to the U.S. economy was long overdue and will be painful, but needed. As they realize their retirement nest egg, based on the false belief that home values would never drop, has disappeared and they finally realize they will have to do something different to protect themselves.
I’m wondering how much of this is the boomers alone. I’m guessing they have finally ‘gotten it’ and are retrenching and going into retirement savings mode. Seeing the savings rate go to 3+% in the last report is great news over the long run but will be painful in the short term
February 3rd, 2009 at 11:15 pm
My newest car is a 1976 Buick Estate Wagon. I own two other cars, a 1959 Lincoln Continental coupe and a 1966 Chrysler Imperial Crown convertible. When there are new real cars being built anywhere at a decent price I’ll buy them. Until then I’ll enjoy what I already own.
February 3rd, 2009 at 11:25 pm
I meant 1974. As long as I’m back I’ll mention it has a Buick 455 Stage 1 engine (dual exhaust, high lift cams, enlarged ports, etc.) Yaaah Hooo!
February 4th, 2009 at 4:25 pm
testing testing my comments aren’t working.