U.S. auto sales slowed across the board in July, with the Big Three automakers tallying a combined market share of less than 50% for the first time ever. General Motors suffered a 22% sales drop, Ford a 19% drop and the Chrysler Group an 8.4% slide. Toyota and Honda also posted 7% declines, though Toyota outsold Ford and Honda outsold Chrysler. Toyota's passenger car sales contracted 13.8% to 112,153 vehicles, while Lexus sales, one of the few bright spots, rose to 27,141 vehicles from 26,959 a year ago. During the month, 15.54 million vehicles were sold, the industry's slowest July since 1998. Domestic auto sales plummeted to 4.79 million, their lowest since data were first collected in 1990. GM and Ford have decided not to cut production for Q3 and have not unveiled what the WSJ calls "major blowout clearance tactics" in the hope that pent-up demand will be released in coming quarters, a prospect bolstered by encouraging consumer confidence numbers. There is concern, however, that the auto market is losing stability as the housing downturn and the turbulent credit market weigh on the sector.
Sources: TheStreet.com, MarketWatch I, II, III, Wall Street Journal I, II [video]
Commentary: Quick Reactions To Today's Auto Retail Earnings • GM, Ford Confuse Investors With The Turnaround Dance • June U.S. Light Vehicle Sales: Not A Bad Month For Auto Retailers
Stocks/ETFs to watch: GM, F, DCX, TOM, HMC. ETFs: ADRA, PRFG, RPV
Earnings call transcripts: General Motors Q2 2007, Ford Q2 2007, DaimlerChrysler Q2 2007
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