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Car and truck sales in Utah and nationally showed signs of stabilizing in June after 10 months of sharp declines, even though every major automaker except Honda Motor Co. reported lower sales than in May.
Still, year-over-year declines last month slowed for four of the six major carmakers, with Ford Motor Co. reporting the smallest drop in a year at 10.7 percent when compared with June 2008.
Even Chrysler, which emerged from bankruptcy protection early in June, saw its year-over-year sales decline shrink, thanks mostly to fire sales to clear inventory. And analysts say that is among the signs that an auto industry slump that began with $4 per gallon gasoline last summer could be leveling off.
"It is unlikely things will get any worse," said Jesse Toprak, executive director of industry analysis for the auto Web site Edmunds.com.
More emphatic about the trend was Craig Bickmore, executive director of Utah New Car Dealers Association.
"This is a positive after months of the numbers going the other way," he said. "We're hearing from dealers that things were better in May and June. We think it's a good sign."
General Motors Corp. and Toyota Motor Corp. saw more substantial dips, of 34 percent and 32 percent, respectively, but both showed improvement over recent months' dismal results. GM has been offering huge discounts and incentives.
Factors such as a slowly improving economy and government incentives of up to
And although Chrysler's sales results were dismal, the figures were roughly in line with analyst estimates and reflect a company that is in a major transition after bankruptcy protection and a new focus on more fuel-efficient vehicles.
Analysts said affordability and gas prices that rose from $2.28 per gallon in May to $2.64 in June boosted sales of sales of compact cars, hybrids and compact sport-utility vehicles. Families and consumers looking for larger vehicles also are leaning more toward minivans because of the practicality when compared to alternatives such as low-gas-mileage SUVs.
Economists say there are signs that the economy is recovering, with housing starts rising more than expected in May and wholesale prices remaining in check. But the Conference Board reported Wednesday that consumer confidence fell unexpectedly in June.
Ford's year-over-year sales drop was the smallest of the six largest automakers. Honda saw a 30 percent decline year-over-year because of extremely strong small-car sales last June when gasoline was above $4 per gallon. Nissan Motor Co. reported a narrower decline than in previous months, down only 23 percent.
GM's decline improved when compared with previous months, even though it entered Chapter 11 bankruptcy protection June 1. GM plans to sell or phase out Pontiac, Saturn, Hummer and Saab to focus on four core brands -- Chevrolet, Cadillac, GMC and Buick.
At Chrysler, though, the company sold only 68,297 cars and trucks last month as it emerged from bankruptcy protection, and many of those were due to strong incentives of more than $4,800 per car, according to Edmunds.
Analysts predict that June sales, adjusted for seasonal variances and multiplied to determine an annual rate, could top the 10 million mark for the first time this year. During several months earlier in 2009, U.S. car and truck sales dropped to a rate of about 9 million vehicles, a huge reduction from more than 16 million as recently as 2007.
But any jump in the annual rate could be fueled by fire-sale prices at 789 Chrysler dealers that were cut off by the company during the bankruptcy process and told to get rid of their inventory by June 9.
