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You are here: Home / Politics / Domestic Politics / Detroit Woes Continue

Detroit Woes Continue

by John Cole|  October 3, 20055:48 pm| 12 Comments

This post is in: Domestic Politics

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Given rising fuel costs, this is no surprise:

Sales of sport utility vehicles took a dive in September, dragging down U.S. automakers who were already expecting a consumer payback after a summer of employee-pricing discounts. Asian brands, which didn’t offer employee discounts, felt less pain.

Several automakers reported strong car sales Monday, but SUVs took a hit industrywide in the U.S. market as gas prices skyrocketed following Hurricane Katrina. Sales of the GMC Envoy and Chevrolet Tahoe fell more than 50 percent compared to last September. The Cadillac Escalade, Mazda Tribute, Ford Explorer, Ford Expedition, Toyota Sequoia and Nissan Armada all saw their sales fall by 18 percent or more. Dodge Durango sales were down 11 percent.

General Motors Corp. sales were down 24 percent overall. Its SUV and truck sales fell 30 percent while its car sales dropped 14 percent. GM’s overall sales were flat for the first nine months of the year.

GM said it knew September would be a challenge after a summer of heavily promoted discounting. GM began letting consumers pay the employee price in June and ended the promotion Friday.

”We’re coming off the three strongest months in the history of the industry,” said Paul Ballew, GM’s executive director of market and industry analysis.

Read the whole thing- it all can’t be blames on rising fuel prices.

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Reader Interactions

12Comments

  1. 1.

    rayabacus

    October 3, 2005 at 5:53 pm

    Maybe the law of supply and demand in the works?

  2. 2.

    jobiuspublius

    October 3, 2005 at 6:37 pm

    Why does the law of supply and demand hate America?

  3. 3.

    JonBuck

    October 3, 2005 at 6:56 pm

    A friend of mine who works for GM explained the company’s problems like this:

    A few years ago there was a commercial where identially-dressed people were opening and closing the doors of idential SUVs. The implication is that GM thinks everybody wants the same car. This strikes me as correct, because GM cars are some of the blandest-looking on the road.

    A few months ago when I was in the new car market I took a close look at the Chevy Cobalt. Great horsepower for a little car, but the gas mileage just wasn’t there. I ended up getting a Corolla even though I could have spent less and gotten more by getting a Cobalt.

    My friend expects GM to go out of business soon. Ford is in the same sinking boat.

    Unless a miracle happens, we’re going to lose both companies.

  4. 4.

    jobiuspublius

    October 3, 2005 at 7:32 pm

    Asian automakers also saw weak SUV sales, but none of the payback that U.S. automakers had to contend with. Toyota Motor Corp.’s sales were up 10 percent in September, thanks to a 22 percent increase in car sales. Toyota’s truck sales fell 4 percent. The Japanese automaker’s sales were up 11 percent in the first nine months of the year, and the company said it set a third-quarter U.S. sales record.

    ”Toyota’s record sales reflect increased interest in fuel-efficient vehicles and hybrids,” Toyota’s North American President Jim Press said. Sales of the hybrid Toyota Prius surged 90 percent.

  5. 5.

    stickler

    October 3, 2005 at 7:36 pm

    We’re not going to lose GM and Ford. They’re too big to fail; and in the case of GM, they’re carrying the costs of hundreds of thousands of retiree pensions. Congress will act to save them. Hell, the SUV tax-code benefit was written into the 2003 tax cut specifically to benefit Detroit-made big SUVs.

    I drive a Ford now, and have a very soft spot in my heart for both companies’ good products. But few important decisions seem to have been made by car guys over the last twenty or thirty years.

    Why is the new Ford 500 only available with a 3.0 liter V6? Why do new GM models always appear with crappy engines? The new S-10 replacement pickup is only available with an anemic 5-cylinder? What idiot decided this? (And don’t get me started on the Pontiac Aztek: a car so ugly that dogs growled at it).

    Too many bean counters in management, for too many years. Bub Lutz and Bill Ford are doing what they can, but the hour is late.

  6. 6.

    TallDave

    October 3, 2005 at 8:44 pm

    Why does the law of supply and demand hate America?

    Socialists of all nations have been pondering that conundrum for centuries, and generally refusing to accept the obvious answer.

  7. 7.

    Mr Furious

    October 3, 2005 at 11:03 pm

    Today on the way home from work, I finally saw the evidence of GM’s grand new plan for saving the company. Next to me at the light was a new Cadillac—brand new. How do I know? About a month ago, GM announced they would boost the company’s image by putting a small GM logo on the quarter panel of every car. Saabs, Hummers, Chevys, you name it.

    So, this Cadillac sat there with it’s little square GM logo tacked on behind the front wheel. Tacked on crooked by a good 5-10 degrees.

  8. 8.

    srv

    October 4, 2005 at 1:09 am

    They’re already talking about another airline bailout because of fuel costs. Soon we will be bailing out GM and Ford.

    Or maybe Toyota will be stupid enough to buy GM and destroy itself like Mercedes is with Chrysler.

    I can’t even watch the nightly news anymore, for fear of cracking a rib laughing. One story after another of some struggling middle class soccer mom not being able to fill the V10 Dodge LandYacht or Ford Canyonero…

  9. 9.

    the friendly grizzly

    October 4, 2005 at 7:13 am

    Jon Buck refers to how ‘bland’ GM cars are. As compared to… what? The thrill and excitement and sheer stylistic beauty of a Camry? The sleek beauty from the “taxicab school” of body design from Mercedes? ANY Bangle-ized BMW? Give me a break.

    As for Mr Furious noticing an emblem 5 to 10 degrees off plumb: that is either a good story, or is the result of work done by a “my job is my birthright” UAW slob. Speaking from PERSONAL experience, my mother’s Cadillac has been one of the tightest and best cars we have yet to own. And some of the mileage she has put on it is taking a neighbor back and forth to the Infiniti dealer to get the next thing gone wrong repaired.

  10. 10.

    Krista

    October 4, 2005 at 9:08 am

    Honestly, I think it’s another sad example of us getting our asses kicked by an Asian industry. We always seem to be two steps behind, don’t we? Any “innovation” that domestic automakers seem to attempt results purely in cosmetic changes, such as the hideous Aztec. I’m sure I’m not alone when I say that I don’t give a crap if my car is bland or beautiful right now — is it safe and reliable, will it last, and what’s the fuel economy on it? I think that’s what the majority of people are looking for right now, and the domestic automakers are missing the proverbial boat (or the Impala…much the same size as a boat…)

  11. 11.

    Hugh Frank

    October 4, 2005 at 11:50 am

    The problems at GM and Ford are entirely self-inflicted. We would be fools to bail them out.

  12. 12.

    Darrell

    October 4, 2005 at 8:17 pm

    Krista Says:

    Honestly, I think it’s another sad example of us getting our asses kicked by an Asian industry

    It’s true our automobile makers have been getting their asses kicked by the Japanese and Germans for a while now. But we have thoroughly kicked their asses in the faster growth, higher paying world of high tech. Whether you’re talking about software, hardware, wireless, microchips, search engines, routers, telecom, you name it, US companies are dominant to the extent that there’s no other country even a close second place.

    I’ve heard older folks say things like “so goes GM, so goes America”.. that may have been true years ago, but not today.

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