The odds stack higher and higher against the companies in trouble.
U.S. auto sales slumped again in September despite sales incentives and falling gas prices in what Ford Motor Co. said was the weakest month yet for the industry this year.
"Consumers and businesses are in a very fragile place," said Ford marketing chief Jim Farley.
[Auto makers report September sales] Getty Images
Ford Motor, along with other auto makers, has seen its pickup sales slump badly this year.
General Motors Corp. Chief Operating Officer Fritz Henderson said he expects the U.S. auto market weakness to continue into 2009 as consumers worry about credit and gasoline prices. On the bright side, GM said September marked its best monthly market share in 2008.
"We again gained retail share, and our total market share looks to be above 27% for the month without an increase in incentives," said Mark LaNeve, GM's North America sales chief.
Ford, Toyota Motor Corp. and Honda Motor Co. reported declines of 35%, 32% and 24%, respectively, while GM rode its now-expired employee-prices sales promotion to keep its decline to 16%.
GM sales of cars and light trucks for September dropped to 282,806, from 334,974 a year earlier. There were 24 selling days, one less than a year ago. Sales of trucks and sport-utility vehicles fell 19% to 164,366, while car sales declined 9.8% to 118,440.
GM launched an employee-discount promotion on Aug. 20 in honor of its 100th anniversary, which stemmed sales declines that month and prompted the incentive's exentsion through September. Ninteen vehicles also were added to the list of eligible vehicles.
GM announced new incentives Wednesday to replace its employee-pricing program. The auto maker plans to offer discounts of up to $5,000 on some pickups and SUVS, including several 2009 models. Discounts on new models have been a rarity in the auto industry, but conditions are different this year, as consumers are slammed by plunging home values, high fuel costs and reduced availability of credit.
GM, which also reiterated its fourth-quarter North American production forecast, has said it has "aggressively managed" inventories to low levels. In September, about 717,000 vehicles were in stock, down 20% from a year earlier.
[Toyota photo] Associated Press
Unsold 4Runners sit at a Toyota dealership in the southeast Denver suburb of Centennial, Colo.
Toyota's fifth-straight month of sales drops shows how the Japanese giant -- once considered almost immune to the economic forces that have battered its Detroit-based rivals -- is now also suffering. Toyota sold 144,260 vehicles in September, compared with 213,042 a year earlier.
Toyota, which is battling GM for the crown of the world's best-selling auto maker, said passenger car sales fell 28% to 88,342, while SUV sales dropped 38% to 22,784. Toyota led GM in sales in the first half of the year and narrowly missed out on unseating GM as the world's top auto seller last year.
Toyota division sales fell 36%, and Lexus recorded a 32% decline.
For Toyota, the last five years have seen particularly rapid sales growth, as the company expanded in the U.S. and other overseas markets. But the past 12 months have delivered more bad news for the auto industry than anyone imagined, making it difficult for Toyota and other auto makers to use emerging-market sales to offset huge U.S. losses.
As for Ford, it sold 120,355 light vehicles, down 35% from 183,769 a year earlier.
Ford truck and van sales fell 39% with SUV sales tumbling 57% and F-series truck sales dropping 42%. Weak truck and SUV sales recently led Ford to push back the launch of its redesigned F-150 pickup truck that once was expected to drive the company's recovery. Ford said Wednesday the first shipments of the new F-150 will soon arrive at dealers; ridding lots of the older model is ahead of schedule, Mr. Farley said.
Honda's sales fell 24% to 96,626, with cars off 22% and trucks sliding 27%. Dick Colliver, Honda's executive vice president of sales, said no one has been immune to the turmoil on Wall Street, including Honda.
Volkswagen AG said its U.S. vehicle sales for September fell 9.4%, to 17,109 from 18,891 a year earlier. Hyundai Motor Co.'s U.S. sales fell 25%, to 24,765 from 33,214.
Chrysler LLC is expected to report September sales later Wednesday.
There is hope that falling oil prices will help boost auto sales, notably pickup trucks and SUVs, and a $25 billion low-interest loan program approved by President Bush on Tuesday also has given some hope to auto makers. The loans are meant to accelerate the development of fuel-efficient vehicles and are expected to principally benefit GM, Ford and Chrysler. The loans could save the auto makers hundreds of millions of dollars and could make bankruptcy less likely.
Wall Street Journal