Several major automakers saw a sales increase in July, when compared to figures from one year ago. For most, that marks the first sales boost they've seen since late 2007. The government's Cash for Clunkers trade-in program is winning most of the credit for the surge.
The Los Angeles Times reports, "Thanks to a wave of trade-ins, Ford in July posted its first monthly sales increase for U.S. sales in more than a year and a half, one of several automakers to report unexpectedly strong months. Other automakers also appeared to benefit from the trade-in stimulus, but not necessarily to the same degree." For example, Toyota saw an 11 percent sales drop in July - but, "compared to a 34% decline for the first seven months of the year," that means July was the company's strongest month so far in 2009. General Motors saw the same trend, with "a 19% decline, far better than its 38% decline on a year to date basis. Chrysler posted similar improvements, with sales down just 9% on the month."
Autoblog reports that Subaru, Volvo, Hyundai, Kia and Volkswagen also saw sales increases in July - with Subaru posting the best results of any automaker, a 34 percent volume increase.
A few automakers had a dismal July despite the program's introduction. Motor Trend notes that Suzuki "had another hard month, moving only 3,507 vehicles. On the bright side, that's 1,350 more than in June, but it still puts sale down a disheartening 57% over July 2008." Porsche, facing a mountain of debt and possible takeover by Volkswagen as soon as this month, saw a 51 percent sales drop.
But the industry as a whole saw a larger boost than many had expected. Business Week reports that July saw Americans on pace to buy 11.2 million vehicles in 2009 - the first time the annualized sales rate has jumped over 10 million since early 2008. That doesn't signal a return to the strongest industry sales - Americans bought more than 16 million cars in 2007 - but "the performance was so much better than the 35% drop-off registered in the first half of this year that automakers are giddy with hope that the worst of their sales doldrums may be over."
The Washington Post's Economy Watch blog, however, urges caution in interpreting the results. "Yes, these are real sales for the automakers and yes, there are real downstream benefits (parts makers and so on) but this does not represent the organic sales that come in a healthy economy," they warn. "The question is: What happens when ‘cash for clunkers' finally ends?"
If you're interested in the Cash for Clunkers program, check out our Cash for Clunkers page. If you're ready to buy, contact local dealers. For the latest news on the program, check out Cash for Clunkers news.
