August USA Car Sales. Ford up 26%

[csv8]

August light vehicle sales in the US have to be good. The “clunkers” program produced almost 700,000 sales. The industry might as well enjoy it while its lasts. September and the rest of the year will be awful.

Edmunds predicts that the 1.17 million cars will be sold this month, which is up 18% from last month and down “only” 6% from last year. Drops of 30% have been closer to the norm in 2009.

The annual sales rate actually hit 19 million in late July. but is only half of that now, the car research company says.

Ford (F) sales are expected to be up a breathtaking 26% from August of last year. Ford continues a comeback which is both remarkable and improbable. There was one time last year when the company was considered much worse off than GM. Ford mortgaged itself to get enough cash to weather the recession and the extreme gamble appears to have worked. Ford’s stock is up almost 250% this year and trades near $8.

The government bailouts of GM and Chrysler are still off to a bad start. Edmunds say that Chrysler sales will be down 19% this month compared to a year ago. The figure will be worse for GM–25%

The “big three” Japanese companies will do relatively well. Sales for Toyota (TM) and Honda (HMC) will be off about 3% and down 15% at Nissan.

The unusual rise of Hyundai will continue as its sales are projected to move up 69%. The firm’s high-value, low-cost cars and its programs to pay for the vehicles of some customers who lose jobs have kept the Korean company on a sales trend that remains the envy of the industry.

This Labor Day will be a depressing one for the car companies this year. The effect of the “clunkers” program will be over and the industry will face four very hard months of what are likely to be extremely poor sales, even with new 2010 models coming out. Edmunds points out “Current purchase intent is down 50 percent from the Cash for Clunkers peak, and down 11 percent from the June average,” noted Senior Analyst David Tompkins, PhD. “Day by day, intent is slipping: Sunday activity was down 21% from Saturday, then Tuesday activity was down 16 percent from Monday.”

Put another way, without the government’s incentive, the domestic auto industry has not recovered at all.

[Ohio XB]

The original $1 billion for the C4C program was thought to last until November, and that would spell 4 months (1/3 year) of prosperous car sales. Instead it lasted 10 days.

Then another $2 billion was approved to go at it again. Why? I have no idea. Congress had decided that the number of sales from $1 billion in incentives would provide the economic boost that our auto industry needed. They got it faster than they were expecting, so shouldn't it have been over? I think so.

So, this new $2 billion extra was expected to last until Labor Day, September 7, (3 weeks instead of the 4 months the $1 billion was expected to last) and it only lasted until last Monday.

So now with so many cars being bought in such a short time, so much shorter than Congress could have EVER imagined, what do they expect to happen in the auto industry now?



It was feel good legislation. They got to feel good for almost 2 months, now its back to figuring out what REALLY needs to be done to create jobs and work. Thing is, the government cannot legislate a good economy. It just doesn't work that way.


Obama said passing the $760 billion stimulus package would keep the unemployment rate from reaching 8%. Only $200 billion of that has been doled out, with much of it not scheduled to go out for 3 or 4 years. How will that help now? And now the unemployment rate in the nation is approaching 10%. In the state I live in it is 11.7%, the highest since the recession of 1983.


No, I have no confidence.



Steve

[phillyc]

Originally Posted by Ohio XB

The original $1 billion for the C4C program was thought to last until November, and that would spell 4 months (1/3 year) of prosperous car sales. Instead it lasted 10 days.

No, I have no confidence.

Steve

Steve, your normally pretty upbeat. At least you still got those Ford shares at a $1.01 last November which are now nearly $8!!!!!

[phillyc]

Originally Posted by csv8

August light vehicle sales in the US have to be good.

Ford (F) sales are expected to be up a breathtaking 26% from August of last year. Ford continues a comeback which is both remarkable and improbable. There was one time last year when the company was considered much worse off than GM. Ford mortgaged itself to get enough cash to weather the recession and the extreme gamble appears to have worked. Ford’s stock is up almost 250% this year and trades near $8.

The government bailouts of GM and Chrysler are still off to a bad start. Edmunds say that Chrysler sales will be down 19% this month compared to a year ago. The figure will be worse for GM–25%

Ford UP 26%,
GM DOWN 25%
Chrysler DOWN 19%
Toyota DOWN 3%

It's looking good in Ford land right now!

[Fordman]

This is excellent news! Imagine when the industry is going good!

[TUF_302]

Go Ford! Go Ford! Go Ford! :

[Iggypoppin']

I remember a time when someone posted the thread about fords stock, and how anyone who purchased it should have bought at 1.01$. I'm betting anyone with stock is probably laughing, and those skeptics who thought ford might have gone under...ha! Goes to show who knew what to do when times where tough.

[Ohio XB]

Originally Posted by phillyc

Steve, your normally pretty upbeat. At least you still got those Ford shares at a $1.01 last November which are now nearly $8!!!!!

What I am talking about is our government action, not Ford. I do fear Ford's sales will be negatively impacted over the next several months to year's end, but not as bad as the others. I think a lot of sales happened now that would have occured over the duration of the next several months, and now those won't be there as a sustained sales progression.

I most certainly hope I am wrong. The nice thing would be those that did not get in on the C4C deal are still motivated to buy a Ford because of what they saw and found in the dealerships; exciting products.



Next year we will be slammed by huge inflation. This will be a direct result of all the money that Obama has had, and is having, printed up. The US dollar will be greatly devalued, so plan on making some purchases in the US as the Aussie dollar gains on the US dollar next year.


Steve