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The Garage: Focus on autos | Nuts & Bolts

September car sales are called weak

September 29, 2007|From the Associated Press

September auto sales are expected to be weak because of the credit crunch, high gas prices and the troubled housing market, reflecting an overall slowdown for the year but little effect from the brief strike against General Motors Corp., industry analysts say.

Jesse Toprak, chief economist for auto information site, predicts Honda Motor Co. will be the only automaker to report an increase in sales, helped by the arrival of the 2008 Accord. Automakers are scheduled to report September sales Tuesday.

Auto sales will probably be down 4% from a year earlier, JPMorgan auto analyst Himanshu Patel said.

Patel predicts Ford Motor Co. will be among the weakest performers, with double-digit declines, as the automaker cut back on incentives as well as sales to rental car companies. Patel said that GM should be flat and that Chrysler would also see some declines.

Lehman Bros. analyst Brian Johnson anticipates that the industry will end 2007 with full-year sales of 16 million vehicles. If so, that would be the slowest year since 1998, when a 54-day strike crippled GM's production, and the total would be 1 million vehicles fewer than the peak of 17.3 million in 2000, according to Ward's AutoInfoBank.

The United Auto Workers' two-day strike against GM this week might have a minor effect on car shoppers, Toprak said. But he said a strike that short couldn't have made a measurable difference. Toprak said GM had about two months' worth of vehicles in its inventory at the time of the strike.

"If anything, it may have helped them in terms of giving them a couple days' break to adjust production in terms of demand," he said.

GM lost production of about 25,000 vehicles because of the strike, automotive forecasting firm CSM Worldwide Inc. said.

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