U.S. car sales tank to troubling depths
— -- Automakers sold barely more than half as many new cars and trucks in February as they did a year ago, as potential buyers worried about more basic concerns — such as whether they'd have jobs or be able to pay the mortgage.
The February auto sales rate, if stretched over a whole year, would amount to just 9.1 million new vehicle sales, the worst annual rate since December 1981, according to sales tracker Autodata. And it's worse than January's grim annual rate of 9.6 million, which many hoped was rock bottom.
Car companies sold 13.2 million new vehicles in the U.S. in 2008, and that low rate forced General Motors and Chrysler to borrow a combined $17.4 billion from the government to stay afloat.
"We'll see some (automakers) not survive" if the sales pace doesn't climb to 10 million or more, says Stephanie Brinley, industry analyst at consultant AutoPacific's Detroit offices.
Deals are plentiful, discounts huge, but would-be buyers are too worried to deal or can't get loans.
South Korean automaker Hyundai says its research found that half the people who'd normally buy this year won't. Most of those holdouts said it was because they are worried about their jobs.
That led to Hyundai's Assurance Plan. It lets buyers miss up to three months of payments if they lose their jobs, and return the car without paying for depreciation if they still can't find work.
In a market down 41.4% in February from a year ago, according to Autodata, Hyundai was off just 1.5% and is up 4.9% this year. "Who knew we'd be jumping up and down about 'down 1.5%?' We've decided that 'flat' is the new 'up,' " says Hyundai's U.S. sales Vice President Dave Zuchowski.
Other February standouts:
•Subaru. Practical image, good safety and reliability scores and a strong push on Forester, one of its least-expensive models, helped boost sales 1.4%.
•Kia. Modest prices pushed sales up 0.4%
"Customers are seeking good value, rational buys. They're not paying premiums for status," Chrysler President Jim Press says.
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