GM holds off Toyota in June U.S. sales

July 1, 2008 7:18:58 PM PDT
June was a dismal month for U.S. automakers with sales dropping by as much as 36 percent. High fuel costs and economic uncertainty are keeping many buyers away.

Some auto dealers may be doing better than others, but across the country, buyers have disappeared from showrooms and lots.

In June, General Motors sales were down almost 18 percent, Toyota was down almost 21 and a half percent, Ford sales plunged nearly 28 percent and Chrysler, down a whopping 36 percent.

Honda was the one bright spot -- up 1.1 percent.

Jeff Qvale is a second-generation Bay Area auto dealer.

"In some ways, I guess they were blindsided, but at the same time, they're making cars people wanted to buy and people like trucks, and people like SUV's, so I don't think they're completely at fault. It's somewhat the demands of the market," said Qvale.

Chrysler will lay off 2,400 workers at plants that make SUV's and full-sized trucks.

"It's a scary thing. You go to work, you talk to your co-workers. Let's make sure we put a good product out there, and the next thing you know, we're shutting the doors on you," said Chrysler auto worker Mark LaRue.

Auto dealers are caught in the middle with cars to sell and few buyers.

"I think they're going to look for great deals at the new car dealerships. New car dealerships obviously have inventory they're trying to move," said San Jose resident Mike Cromartie.

Bargain shoppers are checking out used car lots to save money, especially on luxury models.

"They know that if they buy a one or two-year old vehicle they can take, figure on a BMW that cost $50,000 new when it's got 15,000, it's a year or two older, you can get it for well below $30,000. So they're saving a whole lot of money," said Jerry French from Wheels and Deals.

San Jose's Smart Car dealer is the envy of others. There's an 18-month waiting list for 41-mile-a-gallon cars. It's selling 70 cars a month.

The era of the 12 to 16 mile per gallon vehicle is clearly over. Consumers are demanding a lot more and Detroit has been slow in making the change.


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