10/01/07

September 2007 Auto Sales; Honda Gains at Expense of Ford, Chrysler.

September auto sales, to be formally released tomorrow, are predicted to be weaker than last season's. According a Bloomberg survey of seven economists, car sales will probably be 4% lower year-over-year.

Consumers, responding to the economic slowdown, bought fewer pickups and SUVs and more Hondas.

Ford, perhaps the weakest player, saw 14% y-o-y sales declines.

Ford has reduced incentives and rental car fleet sales.

Chrysler sales fell nearly 6%, while Honda sold 9 percent more cars than the previous September.

Pickups account for 67 percent of Ford sales, and 75 percent Chrysler's.

GM held on for a small gain.

Honda's market share gain narrows the gap between it and Chrysler for the number four position in the US market.

Yes, Honda sales increased dramatically in September, but short term gains are motivated by aggressive clearance of the 2007 Accord ahead of the big mid-market battle of 2008. The action will be between the restyled 2008 Accord, new 2008 Chevy Malibu, and league-leading Toyota Camry.

I expect 2007 to close with full-year sales of 15.9 million vehicles. That would make 2007 the slowest year for car sales since 1998, when a UAW walkout cut GM output.