The Carmakers' Bleak Year-End Numbers

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Rebecca Cook / Reuters

Further dinging Detroit's pride, Toyota managed to end the century-long reign of Ford and Chevrolet as the best-selling car and truck brands in the U.S. Toyota finished the year with U.S. sales of 1,957,575 vehicles, while General Motors' Chevrolet brand sold 1,801,131. Even if the 113,904 vehicles Toyota sold under the Scion name were subtracted from the Japanese automaker's totals, Toyota still beat out Chevrolet. As recently as two years ago, Chevrolet held a commanding lead. (Read "The Bailout Report Card: From A to F.")

Sales of new vehicles dropped in December to the lowest level since the early 1980s, as carmakers turned in a terrible fourth quarter despite aggressive use of incentives. Embattled Chrysler showed the worst decline of all, with sales tumbling 53%.

Ford, however, still had the best-selling vehicle in the U.S., as its F-Series pickup truck claimed top honors for the 32nd year in a row, underscoring the enduring popularity of the American pickup even in hard times. The Toyota Camry was the second best-selling vehicle in the U.S., while the Chevrolet Silverado pickup truck came in third, according to preliminary sales figures released by the manufacturers.

But overall, passenger cars outsold trucks, sport-utility vehicles and minivans for the first time since 2000, according to George Pipas, sales analyst for Ford Motor Co., as consumers reacted to last year's spike in gasoline prices. Truck sales made a modest comeback during the fourth quarter, in part because fuel prices had dropped and truck buyers (a group that includes many small-business owners) had better access to credit than buyers of more fuel-efficient passenger vehicles, automakers say.

The collapse of the new-car market in the second half of 2008 translates to pain all around. Every major carmaker, with the exception of Subaru, reported a sales decline in 2008, including luxury manufacturers Mercedes-Benz and BMW — once considered invulnerable to a recession.

Two of the biggest losers in 2008 were GM and Chrysler, which were recently bailed out by the White House with $17.4 billion in loans. GM reported a 35% sales drop in December and a 27.5% decline for the year. Chrysler's annual number was slightly worse than GM's, down 30%. Ford escaped 2008 with less damage: its sales declined 32% in December and 20% for the year.

Even the new sales king, Toyota, saw its crown tarnished. Despite heavy advertising, Toyota's December sales slid 37.5%, and yearly sales were down 15.7%. Honda also reported a 34.7% decline in December but a modest 8.2% decrease for the year.

A dark year is now over, but automakers don't yet see the dawn. Jim Lentz, president of Toyota Motor Sales U.S.A., says he expects sales in the first quarter of 2009 to be similar to those in the fourth quarter of 2008 — dreadful. While the outlook remains too uncertain for any consensus to emerge on full-year 2009 sales, carmakers are hoping to see some signs of life this spring. "We could see year-over-year comparisons improve (i.e., not be down so much!) starting in April 2009 because the market really collapsed in April 2008," says Rebecca Lindland, an analyst with Global Insight in Lexington, Mass.

"Every recession sows the seeds for its own recovery," says Ford economist Emily Kulinski-Morris. "Sales are actually below the natural replacement [rate], so there is pent up demand for new vehicles," she notes. That, of course, assumes American drivers don't grow complacent with their clunkers.

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