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New Chrysler Boss Says September Auto Sales A "Disaster"
It was a mere two weeks ago that we were predicting a collapse in the September auto SAAR, not only with the push-forward effect of Cash for Clunkers expiring, but after Chrysler and GM reported even August sales that were below forecast. Yet based on a speech by Chrysler boss Sergio Marcchione at the Frankfurt Auto Show, even the "conservative" 9.5 million SAAR that we estimated for September, after the 14.1 million number in August, is going to be an optimistic number. The Fiat/Chrysler boss warned that "we are going to see harsh reality in September." According to Bloomberg:
Chrysler Group LLC, the U.S.
automaker run by Fiat SpA, said nationwide industry sales are
off 19 percent so far this month after a government purchase-
incentive program ended.
Light-vehicle sales in the U.S. last September ran at a
seasonally adjusted annualized rate of 12.5 million, which was
the lowest since March 1993. A 19 percent decline would equate
to a 10.1 million annual rate, higher than any of the first six
months of 2009.
Even GM's Fritz Henderson has thrown in the towel, saying that September will be a "very weak" month. And as for that 10.1 million SAAR, we are happy to take the under.
We are not sure yet how the MSM will prepare the public for the collapse that is now expected in auto sales when they are reported in the first days of October. The bigger surprise is why the auto industry is not following in the footsteps of Senator Isakson and demanding not only yet another extension to Cash For Clunkers, but also an expansion. At this point there is no point in the government pretending it is not subsidizing any and all industry. As David Rosenberg and other economists have speculated, the government accounts for 80%, if not more, of all the "growth" experienced in the economy. The issue is that, as any first year analyst at an investment bank will attest, all such comparable stimuli are considered "non-recurring" unless of course, they become, "recurring." But at that point the economy is effectively one based on central planning: the key construct in any Communist/Marxist economic model. Which, (un)fortunately, is where the US is now and will be for an indefinite amount of time.
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Perfect! Just enough whining for the Govt to re-institute cash for clunkers program.
Great! Enough whining and the cash for clunkers program will be re-instituted!
No problemo! However wretched the September auto sales
number is, it will be pronounced to be "above expectations."
If crysler had been let go the first time. Things would have not have been so hard on both Ford and GM.
I thought the 60 day money back guarantee offer on Government Motors vehicles coming about 10 days behind the expiration of Cash for Clunkers was a bit of a giveaway that showroom traffic had collapsed.
we're waiting for the 30 minute live infomercial where O and the fams take a test drive in the 'new' chevy volt.
It isn't just the lack of stimulus from C4C, or the lack of FTHB credit, etc. It is that the public now EXPECTS to be given incentives to buy. What moron would buy a car this month, when they know if sales collapse, C4C will come back next month? What idiot would buy a house without the $8K credit, when they hear a $15K credit is coming?
We have conditioned people to expect bailouts and act badly. We have taken any sense of responsibility out of our society.
We are going to collapse spectacularly.
I want 0% for 60 months including $4000 cash incentive plus a price stability guarantee that my auto loan can never become upside down.
How's that for entitlement?
Don't forget a program which will make your payments for you if you get laid off.
http://www.gm.com/total-confidence/payment-protection/?brandid=gm&src=unk (though this program expired 6/1/09)
Effectively you're talking about deflation.
"We have conditioned people to expect bailouts and act badly. We have taken any sense of responsibility out of our society."
BINGO!
Give me a circa-early 80s Cutlass Supreme and we can talk.
Total crap build quality but boy could she fly - and it wasn't even mine.
someone should take that miserable company out back and shoot it....
Soon they'll let you turn in the car you bought in August in the C4C program to buy an even newer car. We need to give it a spiffy title.
How about "Cash For Nearly Brand New Cars?"
How bout' "Cash for Senators" or even catchier "Cash for Congressmen"
Turn in your wasteful, worthless, piece of shit Senator/Congressman and recieve a direct deposit of $1,000 of worthless shit currency courtesy of Ben and his printing press.
Well, I guess our big guvy would just add more "stimulus" to keep the market going! Sh**...
Central planning? I would say the US model is more like central DIS-planning. It actually undermines any one, agency or entity, public or private, that takes the time and effort to plan anything. It is a form of metastasised chaos.
???????
That was supposed to read Long Live CHairman Obama in Chinese.
Guess we can't post Chinese characters?
Pretty soon it will be required reading in grade school!
This'll do:
???????????? ?????? ???????????? ?????!
EDIT: Nope. Doesn't do Cyrillic, either.
central planning is also a key component defining fascism
Anyone with me to buy a GM, put 100,000 miles on it, and return on day 59?
LMAO
Cash for Green Shoots? I might need to eat next year.
got sun?
got rain?
grow your own food.
seeds for green shoots.
What is SAAR.
I think it was that flu in Asia or something? Get it free with a purchase of a new car.
seasonally adjusted annual rate
It is a type of flu in Asia. Buy a new car and get a SAAR for free
Seasonally Adjusted Annual Rate
seasonally adjusted annual rate (of sales)
Why is it that policy makers ignore the obvious? Clearly there would not be any benefit to pulling demand forward, everyone had to know it. Short-term gain for long-term pain.
And on the issue of whether Chrysler will make it I say no. There isn't anything in the product pipeline other than what they had before that they couldn't sell so what prospect do they have for success? Very little.
It will be at least a year before Fiat architecture / small cars will be sold here under the Chrysler badge so the whole idea of saving them at tax payer expense was an exercise in futility, and one in wasting tax payer dollars.
The idiocy in DC never ceases to amaze.
Hey Geitner, is your head in your hands yet?
Will the Car Czar come and force my eyelids open and make me watch car commercials until I buy one?
I HAVE ALWAYS HAD A HIGH OPINION OF AMERICANS , HOWEVER, WHEN I SEE THE RAMPANT SOCIALISM AND VALUE DESTRUCTION BEING INFLICTED UPON THE COUNTRY BY SUCH A LEFT OF CENTRE MANIAC, AND THE APPARENT APATHY TOWARDS GENERATIONS OF INDEBTEDNESS I HAVE TO CONCLUDE THAT THE AVERAGE AMERICAN IS A FUCKING IDIOT.
TO VOTE IN THIS ADMINISTRATION IS BAD ENOUGH, BUT TO CHEERLEAD ITS BLATANT WEALTH DESTRUCION POLICIES IS SHEER IDIOCY.
I THINK THE VAMPIRE SQUID IS SMALL CHANGE COMPARED TO THESE ELECTED OFFICIALS..... I MEAN FOR CHRISTS SAKE....HE HAS CZARS !!!! DO YOU EVEN KNOW WHAT CZARS ARE ?
This only increases the chances of a Stimulus II package! Stocks rally...
@curbyourrisk
In the '60's, it was "you better learn Spanish because Central and South America have up-and-coming economies, large populations with massive workforces and a penchant for spending".
In the '80's, it was "you better learn Japanese because they are the kings of business entrepreneurship, keen inventors and the masters of manufacturing".
In the '00's, it's "you better lean Chinese....".
Do you get the picture?
Was it 'learn Russian' in the '50s? On the flip side, if this was France, everyone learns German anyway...just in case someone crosses the border again
Since Toyota was the main beneficiary of C4C, their sales must be looking especially brutal.
Unless GM and Chrysler have collapsed even further.
I agree with a previous poster that letting people have a car for free for 60 days in the vain hope they'll fall in love with it and buy it, whereas they wouldn't have before when the new car smell was still new, is the most desperate act I've ever seen from a company.
And what's to stop someone going to a different dealership at the end of the 60 days and getting another free car for 60 days?
The only good thing about this program is that the poor that were trapped in areas with poor public transportation will have a free car to go job hunting with.
Another question, all the returned cars, will they be sold as "new" or as used at 30% off?
One bad month will not deter green shooters..:-) look at the other positive sides ( the retail sector seems to be going great guns..at least in UK)
Did anyone read the article? In it he says that auto sales will be down because inventory levels are too low and are expected to bounce back next month. This is bullish as far as I am concerned - they will have to ramp up production to meet demand and to re-fill their inventory.
Does anyone hear that sucking sound? Thats the black hole created by sucking any real demand left out of consumer auto purchases. Nothing like blowing your load once, real hard, real nice.
Gonna be a sad day for the sheep when the day of reckoning finally arrives............
This auto market was given a shot of engine starter fluid and sputtered. No wonder it wont go.
Im just sad that the only place the recent sales will go is when the Repo truck comes for it.
"Whatcha gonna do? Whatcha gonna do? Whatcha gonna do when the repo man comes for you?" The bank dont give you no break, your boss gives you no raise etc..."
this is in tandem with everything else that will make Oct the new Sept. you have auto sales with no incentive program, housing incentives ending, the FRB exits the bond market, moratoriums expiring, and our first glimpse at all those seasonal jobs coming to a close.
GFL with the spin on this one!
why would anyone want to be the schmuck that buys a new auto without government subsidies now????
no thank you, i'll wait until taxpayers pay for 10-20% of my next vehicle.
maybe the auto industry can pull a Goldman an "forget" September...like Goldman got away with ditching December in their Q4 08 results (or was it Q1 09?)
heh heh...it was neither ! it's called 'smoothing away the bumps'
@#72036: Agreed, buuuuutt as The Chosen One said on 60 Minutes last Sunday, this all started under Bush. Paulson/Bush were the biggest socialists of all-private gain, public losses. Bush/Obama, whatever-this is for the proletariat to argue over. Same guy, different side of the spectrum. One guy supports warfare state. Another supports welfare state. Both lead to socialist policies. I can't believe the Govt supports 67% of ALL US Mortgages! Are you freak'n kidding me? Banks, autos, housing, military, G (freak'n) E.
At the G-20 in Pittsburgh next week, they want to discourage fosil fuels and electricity. The last bastion of free enterprise? What's left?