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2008:The Historic Collapse

Of The New-Car Market

The Carnage Was Widespread

(And There’s No End In Sight)

2008 was a watershed year in the retail automobile market — an economic “tsunami” that could change the landscape of the business dramatically over the next few years. Some companies and nameplates may disappear, others may shrink dramatically, and many franchised dealers will close their doors. Only the well-heeled players with strong product lineups are likely to survive and thrive. As a consumer advocate with a laser-like focus on this one product category, I believe that knowing how the different nameplates have been doing in the marketplace can be empowering information for new-vehicle shoppers. That’s what this page is about. This is public information, reported broadly every month. I wonder why no other so-called “experts” on new-car shopping (like Consumer Reports) don’t put in the time and effort to provide their customers with this basic, valuable information. And I believe the smartest new-vehicle shoppers will gravitate to information sources that do.

2008 was the worst year for new-vehicle sales since 1992. Sales fell to 13.2 million units, 2.9 million fewer than the 16.1 million sold in 2007. Of the total, 10.6 million units (80.3%) were retail sales to consumers and 2.6 million were fleet sales. The industry-wide decline of 18 percent was the most severe year-to-year drop-off since the early 1970s.

Sales were down from year-ago in every month, but the wheels fell off the wagon in the last third of the year. Sales dropped 11.2% in the first 8 months, but plunged a whopping 32.7% in September-December, when even leading import nameplates Toyota and Honda registered big double-digit declines. Truck sales plummeted 35.9% in that period and car sales nosedived 24.8%, reflecting both the continuing lack of widely available credit and consumers’ lack of confidence in a significant economic recovery in the foreseeable future.

The outlook for 2009 is bleak. J. D. Power has predicted another 13.6% decline to 11.4 million sales, 9.2 million of which will be retail deliveries. That estimate may be optimistic. Several economists feel that the recession, along with the precipitous drop in the stock market and in home values, has changed the way consumers think about discretionary spending, and that many will decide to get new cars less frequently in the future. Yearly sales levels of 16 million have been the norm, but industry analysts peg the “new” natural level of demand when the economy recovers in the range of 14 to 15 million. And they don’t see that happening until 2012 or later. That’s bad news for automakers and their dealers, but not for consumers, who should find retailers dealing aggressively on almost everything they sell.

The balance of this page lists each nameplate’s 2008 percentage sales decline (or, for one nameplate, the MINI, a percentage sales gain), as well as the nameplate's performance in each of the last four months. The comparable data for individual models within each nameplate is not covered. My objective here is simply to illustrate the kind of insights we share in the Fighting Chance information package, which provides current details on the specific model(s) you're shopping for, as well as information on actual transaction prices reported by our customers.

Domestic Nameplates

Buick fell 26.2% last year. September: - 20.5%. October: - 46.3%. November: - 43.3%. December: - 38.1%.

Cadillac fell 24.9%. September: - 39.0%. October: - 55.1%. November: - 48.3%. December: - 38.3%.

Chevrolet fell 20.4%. September: - 10.9%. October: - 40.4%. November: - 36.8%. December: - 25.7%.

Chrysler fell 38.3%. September: - 39.6%. October: - 50.8%. November: - 56.0%. December: - 59.8%.

Dodge fell 25.9%. September: - 25.2%. October: - 27.1%. November: - 44.3%. December: - 51.9%.

Ford fell 19.5%. September: - 33.6%. October: - 28.0%. November: - 30.1%. December: - 33.1%.

GMC fell 25.4%. September: - 12.2%. October: - 53.4%. November: - 42.0%. December: - 33.7%.

Hummer fell 50.8%. September: - 54.7%. October: - 64.6%. November: - 63.9%. December: - 59.3%.

Jeep fell 29.7%. September: - 42.8%. October: - 32.9%. November: - 41.8%. December: - 48.5%.

Lincoln fell 18.4%. September: - 22.5%. October: - 27.7%. November: - 8.3%. December: - 10.1%.

Mercury fell 28.8%. September: - 43.2%. October: - 49.8%. November: - 41.4%. December: - 29.8%.

Pontiac fell 25.3%. September: - 26.7%. October: - 48.2%. November: - 53.4%. December: - 45.6%.

Saturn fell 21.7%. September: - 10.8%. October: - 54.6%. November: - 46.2%. December: - 30.9%.

Oriental Nameplates

Acura fell 19.8% last year. September: - 30.4%. October: - 21.6%. November: - 38.9%. December: - 39.3%.

Honda fell 6.4%. September: - 23.2%. October: - 25.7%. November: - 30.6%. December: - 34.0%.

Hyundai fell 14.0%. September: - 25.4%. October: - 31.1%. November: - 39.7%. December: - 48.3%.

Infiniti fell 11.1%. September: - 24.1%. October: - 28.6%. November: - 28.0%. December: - 34.6%.

Kia fell 10.5%. September: - 27.8%. October: - 38.5%. November: - 37.2%. December: - 39.2%.

Lexus fell 21.0%. September: - 36.1%. October: - 35.2%. November: - 34.7%. December: - 32.4%.

Mazda fell 10.9%. September: - 35.6%. October: - 25.9%. November: - 31.3%. December: - 27.9%.

Mitsubishi fell 24.6%. September: - 39.0%. October: - 19.3%. November: - 36.2%. December: - 22.6%.

Nissan fell 10.9%. September: - 38.4%. October: - 33.5%. November: - 44.4%. December: - 30.0%.

Scion fell 12.5%. September: - 38.7%. October: - 38.5%. November: - 45.2%. December: - 53.9%.

Subaru was flat (+0.3%). September: - 11.9%. October: - 25.7%. November: - 7.8%. December: - 7.7%.

Suzuki fell 16.8%. September: - 46.6%. October: - 46.7%. November: - 46.3%. December: - 50.4%.

Toyota fell 14.7%. September: - 31.2%. October: - 20.1%. November: - 33.1%. December: - 36.7%.

European Nameplates

Audi fell 6.4% last year. September: - 23.2%. October: + 0.3%. November: - 25.4%. December: - 9.3%.

BMW fell 15.4%. September: - 29.5%. October: - 13.9%. November: - 36.1%. December: - 40.2%.

Jaguar fell 9.9%. September: - 30.2%. October: - 60.4%. November: - 10.4%. December: - 44.8%.

Land Rover fell 42.2%. September: - 54.7%. October: - 79.0%. November: - 48.9%. December: - 45.6%.

Mercedes-Benz fell 11.2%. September: - 16.4%. October: - 34.3%. November: - 38.2%. December: - 32.1%.

MINI gained 28.6%. September: - 6.7%. October: + 56.4%. November: + 43.1%. December: + 0.1%.

Porsche fell 24.3%. September: - 44.8%. October: - 50.1%. November: - 48.2%. December: - 25.5%.

Saab fell 34.7%. September: - 27.2%. October: - 13.2%. November: - 57.5%. December: - 57.1%.

Volkswagen fell 3.2%. September: - 9.4%. October: - 7.9%. November: - 21.7%. December: - 14.4%.

Volvo fell 31.2%. September: - 51.8%. October: - 52.1%. November: - 46.5%. December: - 47.0%.

These are some of the insights we share with our customers in the Fighting Chance information package.

Ask yourself these two questions:

Isn't it obvious that knowing this kind of information can change the way you feel about a given nameplate and enhance your leverage in negotiating the price of a new vehicle?

If the answer was "yes," then why has no other new-car information service told you about this stuff? Not Consumer Reports, not Edmund's, not AAA, not Kelley Blue Book, not USAA . . . . . . not anyone, on the Internet or anywhere else. This is public information that's published in many places. In essence, these other guys are clueless about what’s happening in the retail automobile market today. Or maybe they don't want to jeopardize the advertising revenue they get from automakers and car dealers by giving you information that can strengthen your negotiating posture. Whatever the reason, they’re still providing just the same information they were pushing when we were all in diapers. By contrast, we're providing insight, not just data. Information that can change the way you feel about the power you have in the negotiation process.

JAMES BRAGG

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