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US auto sales up for the first time in two years

03 September 2009 14:11 (UTC +04:00)

BakÄ±. Nicat Mustafayev â€“ APA-Economics. US auto sales rose for the first time in nearly two years in August, fueled by the popular government-funded "Cash for Clunkers" program, industry data showed Tuesday, AFP reported.
Hyundai, Ford, Toyota and Honda were the big winners after posting double-digit gains while General Motors and Chrysler continued to report sharp losses despite the increased showroom traffic.
Total auto sales rose one percent to 1.26 million vehicles from 1.25 million in August 2008, the first monthly gain since October 2007, according to Autodata.
That translates into a seasonally-adjusted annualized rate of 14.09 units, the highest since May 2008.
It was also up from an adjusted rate of 11.24 million in July and 9.69 million in June, but still well below the 16 to 17 million vehicles sold every year for the past decade.
Sales remain down 27.9 percent for the year to date, according to Autodata.
"We’re not optimistic about the remainder of the year," cautioned Edmunds.com analyst Jessica Caldwell.
"Factories are ramping up production to fill up the pipeline again - production that may come into a market that isn’t in the mood for buying."
The three billion dollar "Cash for Clunkers" program sparked nearly 700,000 auto sales before it expired last week by offering owners of old gasoline guzzlers up to 4,500 dollars toward a new, more-efficient vehicle.
But analysts cautioned that the nation’s weakened economy and high unemployment rate will continue to drag on auto sales and that the clunkers program may have simply encouraged people already planning to buy a new vehicles buy them a month or two earlier.
"I would suspect that in September we’re going to see a noticeable decline in sales particularly in the first week or two or possibly even into the third week," said Ford sales analyst George Pipas.
Ford’s sales rose 17 percent to 176,323 in August and the automaker said it had managed to boost retail market share in 10 of the last 11 months despite last year’s collapse in sales.
The substantial improvement follows an increase of 2.3 percent in July, Ford’s first year-on-year gain since November 2007, as the only US automaker to escape bankruptcy continues to draw new customers.
Ford’s market share rose 1.9 points to 13.9 percent, according to Autodata.
Despite the success of the clunkers program, Ford intends to continue to show "moderation" with company-financed incentive programs, said Ken Czubay, the auto giant’s vice president for US marketing, sales and service.
Not so for Chrysler, which saw sales fall 15 percent in August to 93,222 units as its market share slipped 1.4 points to 7.4 percent.
The number three US automaker announced a new incentive program Tuesday of up to 4,500 dollars in cash back on select vehicles which will run through the end of September.
General Motors, which saw August sales drop 20 percent to 246,479 vehicles, announced plans to extend a promotion allowing California consumers to buy new GM vehicles at the online auction house eBay.
GM put a positive light on the figures, saying August’s "strong" sales were up 30 percent from July and were "far and away the company’s highest total and retail sales performance of 2009."
The comparison with August 2008 which had been a "monster month for us" was "tough," said Mark LaNeve, GM’s vice president for US sales, who noted that low-margin fleet sales were down significantly.
GM’s market share was down 5.1 points from August 2008 to 19.4 percent, according to Autodata.
Korean automaker Hyundai posted a new record in August after sales rose 47 percent to 60,467 vehicles and its market share increased 1.5 points to 4.8 percent.
Toyota’s market share rose 0.9 points to 17.8 percent after sales climbed 11 percent to 225,088 vehicles in August.
Honda’s share increased one point to 12.8 percent as sales rose 10 percent to 161,439 vehicles.
Nissan meanwhile, saw its share slip 0.4 points to 8.3 percent as sales fell 2.9 percent to 105,312 vehicles.