Automakers face tough road as June sales plummet
Thursday, 3 July 2008
WASHINGTON, July 2 (AFP): Automakers hit more bumps in the road in June as US sales fell precipitously, and manufacturers failed to adapt to a shift in demand to more fuel- efficient cars, company reports showed yesterday.
Overall sales totaled 1.189 million vehicles or a seasonally adjusted annual rate of 13.64 million, down 13 per cent year-to- year, according to market research firm Autodata.
"The four-dollar (per gallon) gasoline, the recession in housing and a collapse in consumer confidence has kept people sitting on their hands," said David Healy, analyst at Burnham Securities.
"It's the worst possible situation for the industry, because not only are sales slow but you have a mix problem where the profitable vehicles like the SUVs (sport-utility vehicles) are hard to give away and they can't build enough of the small fuel- efficient vehicles."
In the current environment of soaring fuel prices and weak consumer confidence, Healy said, "it'll probably be 2010 before any of the Detroit companies will be profitable again."
Overall sales totaled 1.189 million vehicles or a seasonally adjusted annual rate of 13.64 million, down 13 per cent year-to- year, according to market research firm Autodata.
"The four-dollar (per gallon) gasoline, the recession in housing and a collapse in consumer confidence has kept people sitting on their hands," said David Healy, analyst at Burnham Securities.
"It's the worst possible situation for the industry, because not only are sales slow but you have a mix problem where the profitable vehicles like the SUVs (sport-utility vehicles) are hard to give away and they can't build enough of the small fuel- efficient vehicles."
In the current environment of soaring fuel prices and weak consumer confidence, Healy said, "it'll probably be 2010 before any of the Detroit companies will be profitable again."