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The Honolulu Advertiser
Posted on: Tuesday, July 4, 2006

Domestic auto sales down in June

By Sarah Karush
Associated Press

DETROIT Domestic automakers' sales slid in June, lashed by higher gas prices and tough comparisons with last summer's discount bonanza, the companies said yesterday.

Struggling General Motors Corp. got the worst beating, with sales falling 25.7 percent.

But rising fuel costs were a boon to Toyota Motor Corp., which credited its fuel-efficient lineup for much of its 14.4 percent sales increase over June 2005. Honda Motor Co.'s U.S. sales were flat.

Sales from a year ago slipped 15.5 percent at DaimlerChrysler AG's Chrysler Group and 6.8 percent at Ford Motor Co., the companies reported yesterday.

Across the industry, sales were down 10.5 percent, with truck sales down 19.4 percent and cars up 1.6 percent, according to Autodata Corp. The seasonally adjusted sales rate for June, which shows what total sales would be if they remained at the same rate for the entire year, was 16.3 million vehicles. Automakers sold 17 million vehicles in 2005.

GM had warned that its June sales would be down because of discounts last summer.

Paul Ballew, GM's executive director of global market and industry analysis, said comparisons with last year were difficult because of the promotion, which allowed customers to purchase vehicles at the price given to employees.

"The Employee Discount for Everyone program and the success of that program was probably a once-in-a-decade home run for the industry and certainly for ourselves," Ballew said in a conference call.

High gas prices cut into sales of pickups and sport utility vehicles, traditionally the stronger segment at GM and Ford. GM's truck sales fell 37 percent in June, with cars down less than half a percent.

Year-to-date, GM's sales fell 12.2 percent, including a 13 percent drop for trucks and an 11 percent dip for cars.

At Ford, sales of light trucks dropped 14.6 percent. But car sales rose 8.6 percent, as demand for new midsize sedans remained high.

In the first half of the year, Ford's sales fell 3.8 percent, with truck sales down 9.7 percent and car sales up 7.8 percent.

Toyota gained ground in trucks, selling 4.8 percent more last month than in June 2005. Its biggest gains were car sales, which climbed 21.9 percent.

Jim Lentz, executive vice president of Toyota's U.S. division, pointed to a 38.7 percent increase in sales of the fuel-efficient Toyota Corolla as proof of the impact of gas prices.

Year-to-date, Toyota's sales rose 9.8 percent, including a 10.4 percent rise in cars and a 9.1 percent increase in trucks.

Honda's car sales crept up 3.8 percent, while truck sales fell 5 percent. The company reported increased demand for small cars, including a 3.9 percent increase in sales of the Civic. Demand for the Fit, a new subcompact, continued to outpace supply, Honda said.

But not all the Japanese manufacturers escaped the pain. Nissan Motor Co. saw total vehicle sales drop 19 percent.