Detroit in free-fall:
U.S. Auto Sales Fell 8% in December
As Economic Slowdown Tightened Hold
By SHOLNN FREEMAN
Staff Reporter of THE WALL STREET JOURNAL
DETROIT -- U.S. auto sales fell 8% in December, the second straight month of declines, as the economic slowdown tightened its grip on consumers at the end of a record sales year. Even with the Federal Reserve's move to cut interest rates, auto makers said the watchword for 2001 is caution.
"The economy has definitely transitioned," Ford Motor Co. sales analyst George Pipas said. "We know it, Intel knows it and Banana Republic knows it." Despite the rate cut, announced while he was on a conference call with securities analysts to discuss sales results, Mr. Pipas said Ford is sticking to its newly lowered forecasts for sales next year.
December brought big sales declines for Detroit's Big Three. General Motors Corp. said sales sank to 337,972 vehicles, down 18% after an adjustment for the fact that there was one less selling day last month than a year ago. Sales at Ford dropped 14% to 275,095. DaimlerChrysler AG's Chrysler unit said its sales skidded 15% to 167,672.
Although their sales gains moderated, import brands continued to gobble up market share at the expense of the Big Three.
"All year they've had their lunch eaten by Koreans, Europeans and the Japanese, and December is just as bad," said David Bradley, auto analyst at J.P. Morgan.
In December, Toyota Motor Corp. sales shot up 14% to 133,993, driven partly by big end-of-year discounts, dealers said. Honda Motor Co. sales were 88,035, up 2.7%. Volkswagen AG sales rose 12% to 26,865. For the year, Toyota's Camry was the best-selling car in the U.S., and its Lexus luxury division was the top luxury brand in the U.S. for the first time ever, edging out DaimlerChrysler's Mercedes-Benz. GM's Cadillac, once the dominant player in the U.S. luxury market, slipped to fifth place, behind Germany's BMW AG....
interactive.wsj.com
Ah, the wonders that eight years of Clinton/Gore have wrought.
It was heartening to see Cisco's Chambers and GE's Welch - the two most admired business leaders in the country - endorse Prez-elect Bush's tax rate reductions as the best way to pull the economy out of the current free-fall. Didn't see the loser/leaders that supported the other side - those from Apple, Xerox and Novell - down in Austin. That is heartening too.
It is also good to see that Greenspan obviously agrees and endorsed the Bush team's view that the economy is in heap big trouble and did everything to show it by his unprecedented rate cut action. So much for "54 out of 55 business economists" quoted by the Boy President - Greenspan has data they don't.
Other good news is that Greenspan endorses the Bush-Welch-Chambers view that rate reductions are the only way to go with tax cuts, none of that "targeted cut" nonsense that the Clinton/Gore regime used to buy special interest votes. Greenspan knows - and has said so - that such targeted cuts ruined the 1986 tax code reforms and are detrimental in other ways. He knows that rate reductions add to economic efficiency while "targeted cuts" do the opposite. |
