New York, Sept 3: General Motors Corp. and Ford Motor Co. said total vehicle sales declined in August as rising interest rates appeared to dent consumer demand. Sales at DaimlerChrysler Corp. rose modestly, but the increase was fueled solely by strong demand for minivans and sport-utility vehicles. GM said total vehicle sales in the U.S. dropped 5.3% in August compared with the same month a year earlier. Car sales fell 5.4%, and sales of trucks declined 5.3%. Sales in the light-trucks category, which includes SUVs, slid 5.5%.DaimlerChrysler said total vehicle sales in the U.S. rose 2%. Car sales plunged 33%, but sales of sport-utility vehicles rose 18% and minivan sales jumped 48%. Analysts have attributed the boom in minivan sales to heavy incentives as the auto maker makes way for new models. Truck sales increased 16%, DaimlerChrysler said.
Ford said total vehicle sales fell 3%, with car sales skidding 11% and truck sales gaining 3%. Explorer SUV sales fell 0.8%, while Expedition SUV sales dropped 20%. Ford-branded car sales declined 8.6%. Volvo North America sales rose 22%, while U.S. sales of Mercury, Jaguar and Land Rover dropped.
Percentage-change comparisons for the auto makers' sales are based on the daily selling rate in each period. There were 27 selling days in August, compared with 26 selling days a year earlier.(The Wall Street Journal)
In the latest sign that the Federal Reserve's interest-rate increases are succeeding in slowing the economy, several auto makers have been trimming production, citing softer demand. The U.S. auto industry remains healthy, but the sales pace has eased from levels seen earlier this year. Auto makers expect the slowdown to continue.
In recent months, inventories of some new cars and trucks have been rising, leading manufacturers to boost discounts on several models. Now, fearful that an all-out price war could erupt and seriously erode profit, the industry is paring back production instead.
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