DETROIT – Ford Motor Co. said Tuesday its U.S. vehicle sales fell 40 percent in January, setting an abysmal start to 2009 for the automaker and the industry overall as sales to fleet buyers like rental car companies weighed down the results.
Japanese rival Toyota Motor Corp. posted a 32 percent drop for the month but managed to outsell Ford.
Ford sold 93,060 light vehicles in January, compared with 155,832 in the same month of 2008. Toyota sold 117,287 vehicles, down from 171,849. Light vehicle sales exclude heavy trucks.
Other automakers also are expected to report lower sales when they release their figures later Tuesday. The industry has reported at least a 30 percent decline in U.S. sales every month since October.
Chrysler LLC sales chief Steven Landry said Tuesday that U.S. industry sales could drop as much as 35 percent in January. After meeting with Chrysler dealers at a suburban Detroit hotel, he said the annualized sales rate for the month could drop below 10 million for the first time in more than 26 years.
According to Ward's AutoInfoBank, the last month in which the seasonally adjusted annual sales rate dropped below 10 million was August 1982, when it hit 9.9 million as the nation was mired in a recession.
Domestic and foreign automakers have been struggling as unemployment rises, consumer confidence weakens and many people have a tougher time getting loans. General Motors Corp. and Chrysler have received $13.4 billion in low-interest federal loans to stay afloat, and they hope to get more after they submit a viability plan to the government by Feb. 17. Ford has said it does not plan to use government aid.
GM said earlier this month it is planning its turnaround under the assumption the entire industry will sell 10.5 million new vehicles in the U.S. this year. Chrysler has said it's planning on 11.1 million units, and Ford last week reduced its forecast to a range between 11.5 million and 12.5 million. But few people were expecting the automakers to start 2009 at such a pace.
January is typically a slow sales month, and many automakers and analysts are expecting the market to rebound in the second half of the year as the economy and access to credit improves.
Analysts had expected high-volume fleet sales to be down sharply in January, as rental car companies hold onto their current cars longer. The companies have taken a big hit as consumers and businesses cut back on travel budget in the economic downturn, with a spokesman for Hertz Global Holdings Inc. saying rental car demand has fallen by double digits.
Compounding that downturn have been the production cuts across the auto industry that have idled many U.S. factories for several weeks. Many fleet customers get their deliveries right after cars roll off the assembly line, so when factories suspend production, those deliveries come to a halt.
Jesse Toprak, executive director of industry analysis for the auto Web site Edmunds.com predicted industrywide fleet business fell 50 percent from January 2007.
Dearborn-based Ford said January's drop in sales of Ford, Lincoln and Mercury vehicles included a 27 percent drop in retail sales and a 65 percent decline in fleet sales.
U.S. sales at Ford's Sweden-based Volvo division fell 64 percent to 2,910 vehicles in January, from 8,036 a year earlier. The company is exploring a possible sale of the unit.
Toyota's sales of light trucks fell 35 percent on about equal declines in SUV and pickup truck demand, while its car sales dropped 29 percent. Sales of its Prius hybrid slid 29 percent.
Ford shares fell 3 cents to $1.85 in midday trading. GM shares fell 21 cents, or 7.3 percent, to $2.68, and Toyota's U.S. shares rose 82 cents to $64.70.
The Associated Press reports unadjusted auto sales figures, calculating the percentage change in the total number of vehicles sold in one month compared with the same month a year earlier. Some automakers report percentages adjusted for sales days. There were 26 sales days last month, one more than in January 2008.
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AP Auto Writer Bree Fowler reported from New York.
GM to offer buyouts to all hourly employees
NEW YORK – General Motors Corp. will offer buyouts to all of its hourly employees, a spokesman confirmed Tuesday, as the troubled automaker continues to slash costs.
GM spokesman Tony Sapienza said the buyouts will mainly target GM's 22,000 retirement-eligible hourly employees, though any union employee can take the offer.
News of the buyouts first broke on Monday. A union official told The Associated Press then that GM would offer $20,000 in cash and a $25,000 car voucher for workers who retire early and those who simply leave the company. The official spoke on condition of anonymity because workers were not yet notified of the packages.
Sapienza confirmed that the offer will consist of a car voucher and a one-time cash payment, though declined to offer more details, saying that employees will be informed of the specifics of the offer on Friday. However, he said the latest offer would be less generous than previous buyouts.
Sapienza said employees will have until March 24 to decide whether to accept a buyout. Employees who accept the buyout will leave the company by April 1.
The buyouts are the latest round of cost-cutting measures by GM, which is racing to piece together a plan for returning to viability by the middle of the month. The Detroit-based company is scheduled to report January auto sales later Tuesday, and analysts are expecting a steep year-over-year decline.
Shares of GM fell 20 cents, or 6.9 percent, to $2.69 in afternoon trading.
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AP Auto Writer Tom Krisher in Detroit contributed to this report.
Japanese rival Toyota Motor Corp. posted a 32 percent drop for the month but managed to outsell Ford.
Ford sold 93,060 light vehicles in January, compared with 155,832 in the same month of 2008. Toyota sold 117,287 vehicles, down from 171,849. Light vehicle sales exclude heavy trucks.
Other automakers also are expected to report lower sales when they release their figures later Tuesday. The industry has reported at least a 30 percent decline in U.S. sales every month since October.
Chrysler LLC sales chief Steven Landry said Tuesday that U.S. industry sales could drop as much as 35 percent in January. After meeting with Chrysler dealers at a suburban Detroit hotel, he said the annualized sales rate for the month could drop below 10 million for the first time in more than 26 years.
According to Ward's AutoInfoBank, the last month in which the seasonally adjusted annual sales rate dropped below 10 million was August 1982, when it hit 9.9 million as the nation was mired in a recession.
Domestic and foreign automakers have been struggling as unemployment rises, consumer confidence weakens and many people have a tougher time getting loans. General Motors Corp. and Chrysler have received $13.4 billion in low-interest federal loans to stay afloat, and they hope to get more after they submit a viability plan to the government by Feb. 17. Ford has said it does not plan to use government aid.
GM said earlier this month it is planning its turnaround under the assumption the entire industry will sell 10.5 million new vehicles in the U.S. this year. Chrysler has said it's planning on 11.1 million units, and Ford last week reduced its forecast to a range between 11.5 million and 12.5 million. But few people were expecting the automakers to start 2009 at such a pace.
January is typically a slow sales month, and many automakers and analysts are expecting the market to rebound in the second half of the year as the economy and access to credit improves.
Analysts had expected high-volume fleet sales to be down sharply in January, as rental car companies hold onto their current cars longer. The companies have taken a big hit as consumers and businesses cut back on travel budget in the economic downturn, with a spokesman for Hertz Global Holdings Inc. saying rental car demand has fallen by double digits.
Compounding that downturn have been the production cuts across the auto industry that have idled many U.S. factories for several weeks. Many fleet customers get their deliveries right after cars roll off the assembly line, so when factories suspend production, those deliveries come to a halt.
Jesse Toprak, executive director of industry analysis for the auto Web site Edmunds.com predicted industrywide fleet business fell 50 percent from January 2007.
Dearborn-based Ford said January's drop in sales of Ford, Lincoln and Mercury vehicles included a 27 percent drop in retail sales and a 65 percent decline in fleet sales.
U.S. sales at Ford's Sweden-based Volvo division fell 64 percent to 2,910 vehicles in January, from 8,036 a year earlier. The company is exploring a possible sale of the unit.
Toyota's sales of light trucks fell 35 percent on about equal declines in SUV and pickup truck demand, while its car sales dropped 29 percent. Sales of its Prius hybrid slid 29 percent.
Ford shares fell 3 cents to $1.85 in midday trading. GM shares fell 21 cents, or 7.3 percent, to $2.68, and Toyota's U.S. shares rose 82 cents to $64.70.
The Associated Press reports unadjusted auto sales figures, calculating the percentage change in the total number of vehicles sold in one month compared with the same month a year earlier. Some automakers report percentages adjusted for sales days. There were 26 sales days last month, one more than in January 2008.
___
AP Auto Writer Bree Fowler reported from New York.
GM to offer buyouts to all hourly employees
NEW YORK – General Motors Corp. will offer buyouts to all of its hourly employees, a spokesman confirmed Tuesday, as the troubled automaker continues to slash costs.
GM spokesman Tony Sapienza said the buyouts will mainly target GM's 22,000 retirement-eligible hourly employees, though any union employee can take the offer.
News of the buyouts first broke on Monday. A union official told The Associated Press then that GM would offer $20,000 in cash and a $25,000 car voucher for workers who retire early and those who simply leave the company. The official spoke on condition of anonymity because workers were not yet notified of the packages.
Sapienza confirmed that the offer will consist of a car voucher and a one-time cash payment, though declined to offer more details, saying that employees will be informed of the specifics of the offer on Friday. However, he said the latest offer would be less generous than previous buyouts.
Sapienza said employees will have until March 24 to decide whether to accept a buyout. Employees who accept the buyout will leave the company by April 1.
The buyouts are the latest round of cost-cutting measures by GM, which is racing to piece together a plan for returning to viability by the middle of the month. The Detroit-based company is scheduled to report January auto sales later Tuesday, and analysts are expecting a steep year-over-year decline.
Shares of GM fell 20 cents, or 6.9 percent, to $2.69 in afternoon trading.
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AP Auto Writer Tom Krisher in Detroit contributed to this report.
