Gas Prices Decimate Sales

From Fort Wayne Journal Gazette:

High gas prices continued to pull down sales by domestic automakers in June, with General Motors Corp. selling 25.7 percent fewer vehicles than in June 2005, and sales slipping 15.5 percent and 6.8 percent at DaimlerChrysler AG's Chrysler Group and at Ford Motor Co., respectively.

Toyota Motor Corp., meanwhile, credited the company's 14.4 percent sales boost to its many fuel-efficient offerings.

GM, which has an Allen County truck assembly plant, had warned that its June sales would be down significantly because of aggressive discounts last summer.

Paul Ballew, GM's executive director of global market and industry analysis, said comparisons to last year were difficult because of the promotion, which allowed all 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.

He said the June performance was in line with the company's expectations.

High gas prices cut into sales of pickups and big sport utility vehicles - traditionally the stronger segment at both GM and Ford. GM's truck sales fell 37 percent in June, while cars were 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 plummeted 14.6 percent. But the company saw a bright spot in car sales, which rose 8.6 percent, as demand for new midsize sedans - the Ford Fusion, Mercury Milan and Lincoln Zephyr - remained high.

Sales of truck-based SUVs have been declining across the industry for four years in a row, but until recently, pickups were relatively immune from the phenomenon, Ford said. However, pickup buyers now appear to be delaying purchases because of the pressure of high fuel costs, said Al Giombetti, president of marketing and sales for Ford, Lincoln and Mercury.