Analysts Brush Off Dip in Car Sales
U.S. auto sales dropped 11.2% in August, the auto industry reported Tuesday. But auto analysts stressed that the month’s sales were still relatively strong and only appeared weak compared to last August, which was the best month of the year for the industry.
Sales of both domestic and imported cars were off during the month. The domestic industry said its sales fell 11.6%, while imports dropped 10.4%.
The domestic industry reported sales of 600,148 units during the month, down from last year’s 653,974, while import sales totaled an estimated 287,000, down from 308,600 last year. Total sales were 887,148, down from 962,574 in August, 1987.
“Even though sales were down, on an absolute basis, they still were fairly strong,” said Dennis Sperduto, an automotive analyst with Argus Research. “Last August was the strongest month for car sales in all of 1987.”
In August, 1987, auto manufacturers held massive sales to clear their excess inventory before the 1988 model year autos were introduced in the fall.
Auto analysts suggested that one factor in the current strong sales may be that many consumers are aware that prices will go up on 1989 model year cars and are buying now to avoid the higher charges.
Among the Big Three auto makers--General Motors, Ford and Chrysler--only Chrysler’s sales went up, because of its highly competitive incentive programs. Chrysler’s sales rose 5.5%, while Ford’s sales fell 6.2% and GM’s sales dropped 20.7%.
Among the domestic transplants, Nissan’s U.S.-built car sales rose 3.3% and Honda’s U.S.-built auto sales rose 8.4%.
Industry analysts said imports were strong in August because import dealers have more inventory on their lots this year as a result of several major price increases on autos built in Japan. Traditionally, import dealers run very short of inventory in August and September, before the new model year kicks in.
Among the imported cars, only Mitsubishi reported an increase in sales. Mitsubishi’s sales rose 15.3%.
AUTO SALES Percentage changes in auto sales for the month of August are based on daily rates rather than total sales volume. There were 27 selling days in the current period and 26 in the year-ago period.
% August 1988 change GM 284,056 -20.07 Ford 178,023 -6.2 Chrysler 82,366 +5.5 Honda US 33,486 +8.4 Nissan US 13,794 +3.3 Toyota US 5,191 +0.02 Mazda US 3,232 NA Domestic 600,148 -11.6 Toyota Imp. 60,400 -5.4 Nissan Imp. 29,986 -14.4 Honda Imp. 33,050 -5.8 Mazda 20,872 -3.2 Subaru 14,516 -21.2 VW Imp. 14,272 -13.0 Volvo 9,543 -7.8 Hyundai 24,500 -12.1 Mitsubishi 7,606 +15.3 Others* 72,255 -15.3 Imports4 287,000 -10.4 Total US 887,148 -11.2