Spinning their wheels: April car sales plummet
More than anything, April 2009's falling car sales say a lot about how desperately analysts are searching for a silver lining, how tirelessly they're trying to make lemons from lemonade. Any market in which Honda is selling 75 percent of what it sold last year is a disaster, yet spinsters are trying to make its comparatively minor drop look like a triumph.
Chrysler, for example, claims that its precipitous downfall was caused by its planned cuts in fleet sales, not by the fact that it is applying for Chapter 11. However, as Mark Fightmaster recently noted, buying a car whose manufacturer won't outlast the warranty seems somewhat shortsighted. Moreover, the ailing car company's claim that sales numbers were better than expected begs the question of just how horribly Chrysler thought it was doing.
GM, which seems to think that sales have hit bottom, has announced plans to amputate several of its more gangrenous limbs, including Hummer, Saab, Pontiac and Saturn. This, of course, is more or less the same as its pre-sales numbers plan. Toyota's drop, on the other hand, has been blamed on falling gas prices, which have undermined sales of the Prius hybrid hatchback.
The biggest surprise in April's sales numbers was that Ford's 32 percent fall was actually fairly minor; in fact, in concert with Toyota's plummeting numbers, Ford's measured drop put it in second place. Its comparatively positive standing was attributed to two factors. First, with the decline of Chrysler and GM, Ford is the last man standing among domestic automakers, making it the best option for American consumers who wish to buy American. Second, Ford's Fusion sedan is doing exceedingly well, cushioning the effect of ailing sales in other sectors.
Of course, all this analysis is largely meaningless. The simple, and most powerful, reason for the drop in sales is a combination of reduced consumer credit and reduced consumer confidence. Some analysts are predicting a major surge in 2010, when the current crop of cars will be worn out. However, unless the economy shows some serious improvement, it's worth asking who will be around to benefit from the upturn.