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<< Previous   of   Next >>   ADVERTISEMENT   Related Stories • TV with strings attached 4/2/08   CONTACT THE HERALD Mike Benbow, Business Editor benbow@heraldnet.com   Published: Wednesday, April 2, 2008 Double-digit drop in U.S. auto sales worse than expected Associated Press DETROIT -- Automakers reported double-digit U.S. sales declines in March as demand for trucks and sport utility vehicles plummeted and consumers held back because of concerns about gas prices, the housing slump and tightening credit. General Motors Corp. and Chrysler LLC both reported a 19 percent drop in U.S. sales Tuesday. Ford's sales dropped 14 percent and even industry stalwart Toyota was down 10 percent compared with last March. Nissan fell 4 percent, and Honda reported a 3 percent drop. Some automakers warned things could keep getting worse in the near term. "I'd like to be able to tell you that the worst is behind us, but I really can't give you that assurance," Jim Farley, Ford Motor Co.'s sales and marketing chief, said in a conference call. Farley said Ford is concerned the shrinking availability of consumer credit will continue to hurt sales and that the second quarter could be more difficult than the first. GM's truck and SUV sales were down 22 percent in March while its car sales fell 14 percent. New models such as the Chevrolet Malibu were a bright spot, with sales up 17 percent, but sales of Chevrolet pickups were down 25 percent while sales of GM's gas-guzzling Hummer brand fell 29 percent. GM's sales were down 11 percent for the first quarter. "There's no question that the industry and the economy is in a weakened state," said Mike DiGiovanni, GM's executive director of global markets and industry analysis. "We expected the first three quarters to be weak, and this has exceeded what we thought." DiGiovanni said GM remains hopeful the federal economic stimulus package will help sales in the second half of the year. Mark LaNeve, GM's vice president for North American sales and marketing, said a monthlong strike by American Axle and Manufacturing Holdings Inc. that has idled or shut down 30 factories that make GM trucks, cars and SUVs has cut GM's production by 100,000 vehicles. But he said slow sales and a high inventory before the strike has minimized the impact. LaNeve said truck and SUV supplies were "more than adequate" for spring, but he wouldn't speculate on whether the strike will hurt the Malibu and other hot sellers. "We don't believe that it's affected retail business one bit to date," LaNeve said. A 24 percent jump in sales for Ford's popular Edge crossover couldn't make up for falling sales of pickups and large SUVs. Ford's truck and SUV sales dropped 16 percent versus March 2007. Sales of the Ford Expedition SUV fell 34 percent, while sales of the perennially popular F-Series pickup -- which will be replaced with a new version this fall -- were down 24 percent. Ford's car sales fell 10 percent, dragged by declining demand for the Ford Mustang and Crown Victoria sedan. Ford's overall sales for the first quarter were down 9 percent. Toyota Motor Corp., which beat Ford to become the No. 2 automaker by U.S. sales last year, held onto its lead in the first quarter, outselling Ford by more than 43,000 vehicles. But Toyota took a beating in March, reporting truck and SUV sales down 14 percent and car sales off 7 percent. The Tundra pickup saw a surprising 17 percent sales increase, but totals were hurt by SUV sales, which fell 20 percent. Toyota's sales dropped 6 percent for the quarter. Chrysler's car sales fell 13 percent and its truck sales plunged 22 percent, in part because it cut low-profit sales to rental car agencies. Chrysler saw no boost from its much-hyped, newly redesigned Chrysler Town and Country and Dodge Caravan minivans, which saw sales drop 2 percent and 21 percent, respectively. Chrysler's sales fell 16 percent for the quarter. Honda Motor Co., which had bucked the downward trend in February, saw its 3 percent increase in car sales eroded by a 12 percent decline in truck and SUV sales. That drop was led by the Honda Pilot SUV, which fell 24 percent. Honda's sales were flat for the first quarter.

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