Kitsap Business and Economy

DETROIT (AP) — U.S. auto sales in November showed more signs of stability, with Ford and Toyota reporting steady to higher sales.
But Chrysler struggled for another month, while Hyundai again posted double-digit sales growth.
Automakers are looking for signs of life in the auto market, which is recovering from a historic drop in sales that began last year. Sales in October were unchanged from a year ago, and stable numbers in November could signal a recovery is under way.
Small monthly auto sales increases are likely as the economy continues its slow improvement, but larger auto sales gains will not happen until the jobless rate drops substantially, and people feel confident spending money on big-ticket items, said Martin Zimmerman, a former Ford Motor Co. chief economist who now teaches at the University of Michigan.
The U.S. jobless rate hit 10.2 percent in October, a 26-year high, and Zimmerman said people are holding onto their vehicles until the rate begins to drop.
Carmakers continued to rely on discounts and other incentive spending to sell cars and trucks last month. Sales incentives rose 2 percent in November to $2,713 per vehicle, according to the auto Web site Edmunds.com.
Ford’s sales were essentially flat compared to last November, at 122,846. But sales of crossovers rose 26 percent and sales of cars rose 14 percent. Trucks and SUVs saw double-digit declines. Crossovers are as roomy as SUVs but are built on lower car frames, which improve their fuel economy.
Chrysler said it sold only 63,560 vehicles last month, a decline of 25 percent, and it announced an array of sales incentives including zero percent financing and cash rebates designed to draw buyers into its showrooms.
Other automakers are reporting sales on Tuesday.
Ford said its hybrid sales increased 73 percent, to 2,361, as buyers gravitated toward gas sippers. At about $2.65 per gallon, regular gasoline is up around 50 cents over November of last year.
The Ford Fusion sedan, which leads the mid-size category in fuel-efficiency at 34 miles per gallon, posted a 54-percent increase from last November, shattering its previous record for full-year sales.
Overall U.S. sales are expected to rise compared with last November, when they fell to a 26-year low of 743,606, according to Ward’s AutoInfoBank. Sales tumbled even lower in January and February before climbing steadily through the spring and summer.
Although the factors that drove down last November’s auto sales, such as frozen credit and the stock market collapse, have abated, auto sales will not lead the economy out of recession, Zimmerman said.
“I think we have to see more of a coincident rise in the level of economic activity,” he said. “I think it’s a ways away. It’s coming. It’s not here yet.”
Ford showed some optimism for the coming year, increasing first-quarter production plans by 58 percent to 550,000 vehicles. Its fourth-quarter production plan is unchanged.

This entry was posted on Tuesday, December 1st, 2009 at 10:38 am by Rachel Pritchett and is filed under Uncatagorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.