Automakers Report Worst January Sales in Almost 50 Years

Monthly Totals in U.S. Fall Below Those in China for First Time

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DETROIT (AdAge.com) -- The last time the auto industry sold roughly 669,000 vehicles in the U.S. in January, as it did this year, was in 1963, when Chubby Checker ruled the music charts and Michael Jordan was born.

Toyota Motor Sales USA saw its Toyota, Scion and Lexus sales in January drop 34.4% compared with a year ago and moved back some advertising for its all-new Venza wagon, for which it had originally planned a major blitz last month.
Toyota Motor Sales USA saw its Toyota, Scion and Lexus sales in January drop 34.4% compared with a year ago and moved back some advertising for its all-new Venza wagon, for which it had originally planned a major blitz last month.
Adding to that bad news, China surpassed the U.S. for the first time in monthly sales, said Mike DiGiovanni, executive director-global market analysis at General Motors Corp. He said about 790,000 units were sold in China last month.

GM reported selling 129,227 vehicles in the U.S. last month, a 48.8% drop from January 2008. Mark LaNeve, GM's VP-marketing, sales and service in North America, said the automaker's average transaction price rose $214 in January to $26,951, however. He also said GM sold about 5,000 new vehicles in January that were financed by its GMAC division, compared with virtually none in the fourth quarter after the lending arm lowered its credit-score requirements at the end of the year.

"We are going to keep attacking aggressively with our annual President's Day Sale," which offers 0% financing for 60 months or 1.9% financing for 72 months on most volume models, Mr. LaNeve said.

Ford Motor Co. reported a 38.9% drop Ford-Lincoln-Mercury vehicle sales vs. January 2008, to 90,596 units. Ford's George Pipas, sales analysis manager for the U.S., estimated that Ford's retail market share rose 0.3 points in January vs. a year ago, to 12.7%. It's the first time since 1995 that the automaker has posted four straight monthly jumps in retail share.

Dramatic drop in fleet sales
Both Ford and GM said a dramatic drop in industrywide fleet sales last month was the key reason for their dismal January sales.

On the fleet side, Mr. Pipas estimated that all automakers sold 65% to 70% fewer new vehicles to car-rental, business and government customers in January compared with a year ago. Meanwhile, the retail business, or sales to individual Americans, seemed to remain stable in January, he said.

Ford sold only about 2,000 fleet vehicles in January vs. 14,000 in January 2008 and 12,000 in December 2008, he said. GM tallied 13,000 fleet units sold, or 10% of its total monthly new-vehicle sales, down 80% from January 2008, Mr. DiGiovanni said.

Toyota Motor Sales USA saw its Toyota, Scion and Lexus sales in January drop 34.4% compared with a year ago, to 117,287 units. "The entire auto industry continues to find itself in the eye of this economic storm," said Toyota Division's Bob Carter, group VP-general manager.

Still, Mr. Carter said he is encouraged by a boost in the Toyota brand's web traffic, up 2% last month vs. January 2008 and 10% compared with December. "There's significant pent-up demand," said Mr. Carter, who added that he expects the industry to start a "modest recovery" at the end of the second quarter.

Major blitz delayed
He said Toyota "moved back some advertising" for its all-new Venza wagon, for which it had originally planned a major blitz in January. Although Toyota did have some Venza ads in TV sports programming, including the Super Bowl, the marketer instead used the bulk of Venza's January ad budget for other model, he said. The short delay was partly due to production cuts at the plant that makes the Venza and the Camry. Toyota is starting production of the four-cylinder Venza this week, he said, the big media push for the model will arrive this month.

Saatchi & Saatchi Los Angeles, Torrance, Calif., handles the Toyota brand's general account, although the marketer ran a 30-second Venza commercial during Sunday's big game from its African-American shop, Burrell Communications, Chicago.

The three other major automakers also reported double-digit percentage drops in their January sales vs. a year ago. Chrysler Group said its January sales plummeted 55% to 62,157 units; American Honda Motor Co. saw its U.S. Honda and Acura sales slide 30.7% to 71,031 units; and Nissan North America said it sold 29.7% fewer new Nissan and Infiniti models, falling to 53,884 units.

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