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The Honolulu Advertiser
Posted on: Saturday, October 15, 2005

Auto sales sink with end of discounts

By David Runk
Associated Press

DETROIT — U.S. auto sales fell precipitously in the first part of October, as employee-discount incentives ended and gas prices made consumers jittery, the results of a survey released yesterday suggested.

The numbers also showed a possible fallout from strong summer sales, according to Power Information Network, a division of J.D. Power and Associates.

New-vehicle sales were down 33 percent in the first nine days compared with the same period a year ago, and down 44 percent compared with the first nine days of September, the survey found.

Sales at No. 1 automaker General Motors Corp. were down 57 percent compared with early October 2004, while Ford Motor Co.'s sales were down 45 percent. According to the PIN survey, DaimlerChrysler AG's sales were off 32 percent in early October, while Nissan North America recorded a 21 percent decline. American Honda Motor Co. showed the smallest decline, of 8 percent, followed by Toyota Motor Sales USA, which had a 14 percent drop.

"The aftermath of the employee pricing programs is having a dramatic impact," said Jeff Schuster, executive director of global forecasting at J.D. Power. "A lot could happen between now and the end of the month, but at this point, we're on track for an October like we haven't seen since the early 1990s."

Last month, lower sales of sport utility vehicles — coming amid higher gas prices seen in the wake of Hurricane Katrina — dragged down U.S. automakers who already were expecting a dropoff in sales after offering employee prices on many models to all consumers during the summer.