February Auto Sales Preview: Worse than January?

Well another month of 2009 is already under our belts (my how the time flies), and that means it is auto sales time yet again. January was just a plain old ugly month, with total auto sales declining a combined 37%. The following chart outlines the major automakers that we monitor and the results posted in January, the percentage change compared to January 2008, and the total change for 2008.

We suspect that the month of February was even worse for the automakers. Consumer confidence continued to languish near record lows, the economy continued to worsen, and the unemployment rate increased. To add icing to the cake, during February there was all the talk (again) about General Motors (GM) seeking bankruptcy protection. Both Chrysler and General Motors submitted viability plans to the "Auto Viability Task Force" but little has come from these submissions.

I have done radio interviews for Fox Radio affiliates across the country and it is interesting to hear the differing opinions regarding the automaker and financial bailouts, as well as President Obama's stimulus plan and budget depending on the region of the country. I still think that the automakers need to be helped through this difficult time (read NOT BAILED OUT). Cheaper loans and some incentive spending are by no means a bailout and if the government wants to take a stake in the automakers, I think those respective companies would welcome the government as it would give the industry more time to rework itself. I am getting ahead of myself; let's see how bad the numbers are first before we decide if the American people should own the largest insurer, bank, and auto manufacturer in America.

As a side note to everyone that thought Toyota was the perfect auto manufacturing company, the Japanese automaker yesterday went to the Japanese government seeking cheaper loans to help it through this economic downturn. Sound familiar?