Business

Vehicle sales plunge

DETROIT — General Motors' October U.S. sales plunged 45 percent, and Ford's and Chrysler's weren't far behind, as low consumer confidence and tight credit combined to bring the industry's sales to a crippling level that is the worst in 25 years.

Automakers sold 838,156 vehicles in October, 32 percent fewer than the same month last year and the worst performance since January 1991, according to Autodata Corp. and Ward's AutoInfoBank. The seasonally adjusted annual sales rate of 10.6 million vehicles was the lowest since February 1983.

"It's really an unsustainably weak level for all manufacturers," said Mike DiGiovanni, GM's executive director of global market and industry analysis. "This is clearly a severe, severe recession for the U.S. automotive industry and something we really can't sustain."

The annual sales rate in October 2007 was 16.1 million.

Chrysler's sales tumbled 35 percent and Ford's dropped 30 percent. Toyota's sales fell 23 percent despite its zero-percent financing offer, and Nissan and Honda posted 33 percent and 25 percent declines, respectively.

If GM's sales were adjusted for population growth, October would be the worst month of the post-World War II era, DiGiovanni said.

"Clearly we're in a very dire situation," he said. Detroit-based GM said its light truck sales tumbled 51 percent compared with the same month last year, while demand for passenger cars fell 34 percent.

Despite the steep drop, GM's total was enough to keep it ahead of Toyota Motor Corp. for the No. 1 U.S. sales spot. Toyota, which rolled out an offer of zero-percent financing during the month, sold 152,101 vehicles. The Japanese company's light truck sales fell 34 percent, while car sales dropped 15 percent.

The vast majority of Toyota models still posted double-digit declines. Notable exceptions included sales of the Corolla, which rose 6.1 percent, and the Sequoia sport utility vehicle, which posted a 21 percent gain.

Bob Carter, Toyota Division general manager, said the financing offer, which had been set to expire on Monday but will now be extended for another month, gave October's sales a needed boost. "This managed to breathe some life into an otherwise lackluster month," Carter said.

GM's financing arm, GMAC Financial Services, said last month it was tightening its lending standards to require a credit score of at least 700, shutting out some potential buyers.

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