AFSCME 3357-HOF'S BLOG

Where are the August Sales Numbers?

It's now September 3, the third business day of the month, and the auto industry sales numbers from August have not yet been posted. Perhaps everyone is waiting for Hurricane Hanna to blow its way up the East Coast on Friday and distract everyone from the bad news. Overall, August numbers are likely to be similar to the poor results from June and July. Bloomberg news is publishing analysts' estimates of sales. Overall, the analysts estimate that total industry sales increased to an annual rate of 13 million units per year in August, up from 12.6 million rate in July. The primary instigator of the sales increase was General Motors' Employee Pricing for All promotion. Today GM announced that it would extend the offer for another month and extend it to cover some 2009 models, primarily 2009 models that came out in the first half of 2008, such as the Pontiac Vibe and the Cadillac CTS. (It is discouraging to see high inventory models for these vehicles, especially the highly-regarded Cadillac CTS, because most of GM's fall 2009 models are essentially carry-over. There's nothing new to lead a sales surge.)

Even though GM's sales will be a little better than last month, the analysts predict that GM's sales will be 29% below last year. Chrysler's numbers will be about 34% below last year. Ford will report sales about 21% below 2007. In comparison, Toyota's sales dropped about 11%, and Honda's sales decreased 7.4%.

Speaking of Hurricane Hanna, this storm is on path to deliver a glancing blow to East Coast, from Florida's Gold Coast to Cape Hatteras, North Carolina, with tropical storm level winds extending up the coast all the way to Canada's Maritime Provences. If it takes this route, probably no community will see a disaster on the scale of Hurricane Katrina, but significan damage over a large area could make for huge insurance losses. Some of the insurance money would go to car owners replacing storm-damaged vehicles. No doubt there are some auto executives thinking 'Go Hanna, Go." To track Hanna and other storms, here's a link to the National Hurricane Center.