New figures released yesterday (3rd March) have suggested that auto sales in the US dropped by 41 per cent during February to their lowest levels for nearly 30 years.

According to MotorIntelligence.com, a total of 9.1 million vehicles were sold over the course of the moth, which represents the smallest total recorded since December 1981.

The latest statistics mean that the country has now endured 16 consecutive months of sales decreases, with the worsening economic landscape forcing firms to cut production and increase discounts.

Reacting to the news, Efraim Levy, Equity Analyst at Standard and Poor's, said: "In our view, we are in an automotive depression.

"Shell-shocked consumers fearful for their jobs, the value of their homes and stock market assets are wary of making the sizable discretionary purchases."

General Motors (GM), which is currently completing a restructuring plan as it seeks further financial support from the White House, has been the firm worst affected by the slump.

The Detroit-based car giant saw its sales slump by 51 per cent on a year-on-year basis, which was the lowest total it has recorded for the month of February since 1967.

Chief Sales Analyst Mike DiGiovanni said: "These are obviously unsustainable levels and will cause almost every major automaker across the world to seek government aid."

Chrysler LLC, which is also involved with GM in the $17.4 billion bail-out by the government, posted equally worrying sales declines for the month of 44 per cent.

In addition, Ford - which has not asked for central support and is reportedly the best-placed of the 'Big Three' to deal with the financial crisis - saw its sales decrease by 48 per cent.

Japanese automakers only fared slightly better, with Toyota and Nissan seeing sales slide by 37 per cent and Honda posting a fall of 38 per cent.

Bob Carter, General Manager of Toyota's flagship brand in the US, expressed his belief that the situation will improve in the second half of the year, although he admitted he was unsure as to when exactly.

He said: "It's just a question of when in this summer we start to push off this bottom. We remain confident that will happen and it's part of our plan."

That view was shared by Emily Kolinki Morris, Senior US Economist for Ford, who explained that the figures imply that there is "no anchor on the economic horizon" to help predict when the bottom has been reached.

The news comes despite automakers offering an average discount of $2,900 on every vehicle in February, up by eight per cent from the previous month, according to auto research website Edmunds.com.

"Incentives are helping the few buyers who are in the market to make a purchase, but they are not drawing new buyers at all," said Rebecca Lindland, an analyst with HIS Global Insight.

"It's just stunning how horrible the market is now. We are not expecting to see sales recover at all until the consumer recovers."

Ford and GM also announced on the back of the results that they will be cutting their production plans for the second quarter of 2009.



Sources:

WRAPUP 5-US February auto sales fall as recession deepens (04/03/09)
http://www.finanznachrichten.de/nachrichten-2009-03/13268839-wrapup-5-us-february-auto-sales-fall-as-recession-deepens-020.htm

US car sales plunge in February (03/03/09)
http://news.bbc.co.uk/1/hi/business/7920379.stm

Already Bleak, Auto Sales Take a Fall in February (03/03/09)
http://www.nytimes.com/2009/03/04/business/04auto.html?_r=2&ref=business