n The February decline could be the worst in 27 years.
By TOM KRISHER and BREE FOWLER
The Associated Press
DETROIT – Major automakers’ U.S. sales continued their deep slump in February, putting the industry on track for its worst sales month in more than 27 years as huge rebates and low-interest financing failed to spur fearful consumers to make a major purchase.
General Motors’ sales tumbled 53 percent from a year earlier, while Ford’s U.S. sales fell 48 percent and Chrysler’s fell 44 percent. The major Japanese automakers fared only slightly better.
The slide casts further doubt on the financial viability of GM and Chrysler, which need to sell cars and generate critical cash to supplement the $17.4 billion in government loans that are keeping them in business.
Toyota Motor Corp.’s U.S. sales plunged 40 percent, while Honda Motor Co.’s sales dropped 38 percent and Nissan Motor Co.’s fell 37 percent.
Automakers and analysts have been predicting sales will rebound in the second half of this year, but they are becoming less certain. Massive layoffs, the stock market decline and sliding home values are prompting people to hold on to their cars longer, while those who are buying are more often opting for a used car or truck.
Emily Kolinski Morris, Ford Motor Co.’s top economist, said retail sales to individuals had been stable for four months but dropped in February, indicating that last month may not be the bottom for auto sales.
The bottom, she told reporters and industry analysts, can’t be predicted. But she said Ford’s forecast still calls for a modest second-half recovery as economic stimulus measures takes hold.
Industry analysts say when all the numbers are tallied, February sales could be worse than January’s total of 656,976 light vehicles. That was the lowest monthly total since the industry sold 656,310 vehicles in December 1981, according to Autodata Corp. and Ward’s AutoInfoBank.
The low point is likely even though automakers spent more on rebates, low-interest financing and other incentives in an effort to bring out buyers.
But despite the fantastic deals, sales continued to slump.