November auto sales weak
DETROIT (Reuters) - U.S. auto sales slipped in November, led by an 11 percent drop at General Motors Corp GM.N, as a weak housing market and higher gasoline prices kept buyers from showrooms and heightened concern that the industry was headed for a deepening downturn.
Retail sales for all three Detroit-based automakers turned lower in November. Executives across the industry cautioned that sales would remain under pressure headed into 2008 because of increasing economic uncertainties.
Both Ford and GM, which have recently clinched cost-cutting labor deals with the United Auto Workers, responded to the sales dip by cutting first-quarter production plans from year-earlier levels.
Ford (F.N) posted a narrow sales gain of 0.4 percent for November, marking its first monthly increase after a full year of unbroken declines. Ford's gain was driven mostly by stepped-up sales of vehicles to commercial fleet operators.
Toyota Motor Corp. (7203.T), which has eclipsed Ford for the No. 2 position in the U.S. market, eked out a slight sales gain of 0.3 percent but saw sales for its luxury Lexus brand drop by 7 percent.
"Rising fuel prices and sliding home values delivered a one-two punch this month," Toyota's U.S. sales chief Jim Lentz said in a statement.
Toyota's Japanese rivals posted more limited sales gains than analysts had forecast. Nissan Motor Co (7201.T) rose 6.1 percent. Honda Motor Co (7267.T) sales rose 4.7 percent.
CSM Worldwide analyst Michael Robinet said the cutbacks announced by both Ford and GM showed that U.S. automakers were taking advantage of new flexibility in their just-completed labor pact to idle capacity in the face of slack demand.
"They're coming to terms with the real economics of the industry," he said. "No longer is Detroit just out to move the metal."
Industry-wide U.S. sales of cars and light trucks were down about 1.6 percent in November from a year earlier at 1.18 million vehicles, according to tracking service AutoData Corp.
Ford, which is battling to stabilize market share, cut production by 7 percent and said it would keep a tight lid on output in light of the weakening economy.
GM cut its planned production by 11 percent.
"Vehicle sales have softened over the last few months. We believe this reflects concerns about the credit and stock market squeeze, along with the ongoing adjustments consumers are making in response to housing and gasoline prices," Ford economist Emily Kolinski Morris told reporters and analysts.
"Clearly we're concerned about the credit market turmoil and the softer economy, so we're taking a cautious approach to planning our business," she said.
GM's sales chief Mark LaNeve echoed that sentiment. "We don't want to bury our dealers in inventory," he told analysts. "We want to try to continue to run leaner on inventory." Continued...
