We all knew surging gasoline prices would hurt auto sales. But it’s happening a lot faster than many had guessed.
Automakers are reporting their June sales figures today, and if red is your favorite color you may like what you see. Ford’s sales were down 28 percent from a year ago, and GM’s were off by 19 percent. The big surprise was Toyota, down 21 percent. It seems Toyota’s overall sales were less dependent on its highly coveted Prius cars than on its trucks.
Since February, gas has risen from $3 a gallon on average to more than $4, where it has lingered for much of June. So a lot of the hottest, low-mileage models of recent years are baking in the sun on car lots, while hybrids and other fuel-efficient cars are in hot demand.
The two manufacturers who saw their sales increase, Honda and Volkswagen, are the same passenger-car makers that have seen their market share dwindle in the age of the SUV. Both saw one-percent gains.
Then there’s Ford. Its F-Series pickup truck, which gets about 15 miles a gallon on city streets, managed to sell 38,789 units in June. But that figure is down 41 percent from June 2007. The F-Series, long America’s best selling vehicle, was outranked last month by the Corolla and Camry from Toyota and the Civic and Accord from Honda. Only two of Ford’s 20 or so models gained on year: the Ford Fusion, up 18 percent, and the Mercury Milan, up 8 percent.
The problem for automakers is, demand has changed in a matter of a couple of months, while automakers need a year or so to increase or decrease supplies. They might have seen this shift coming a year or so again, but they didn’t act.
Even Toyota failed to keep up with changing demands. It sold 17,806 hybrids in June, two thirds of them Priuses. But it sold three times as many light trucks: 53,957 of them. Even so, light-truck sales were down 32 percent in June. Toyota may market itself as a maker of fuel-efficient hybrids, but it’s just as exposed to America’s shunning of SUVs as any carmaker.
Toyota’s performance in June was so disappointing that General Motors was able to cling onto its title as the largest U.S. automaker. Only because GM’s 19-percent decline wasn’t as steep as Toyota’s, it still wears the crown.
That’s hardly a silver lining, it’s more like a string of tinsel. But in this economy, automakers will take good news where they can get it.