Auto sales flat in Canada, stall in US

Canadian automakers Wednesday reported a slight rise insalesoverall in August, in stark contrast to mostly flagging results in the U.S.

Oakville, Ont.-based Ford Canada saidsales rose eight per cent from the same month a year earlier, to 24,034 cars and light trucks.

That made it Ford's best August in 20 years and kept the company in top place in Canada.

GM Canada's overall sales were up 2.3 per cent to 23,536, while Chrysler Canada sold 16,144 vehicles, up 12 per cent over the same month last year.

Honda Canada said combined sales of its Honda and luxury Acura divisions totaled 12,914, a six per cent increase.

Toyota's Canadian sales fell 29.5 per cent to 12,862 as the company continued to feel the impact of a series of problems that have seen more than 10 million vehicles recalled worldwide in the past year.

Data compiled by DesRosiers Automotive Consultants suggested that overall Canadianauto sales were essentially flat in August at136,069, a gain of 0.5 per cent from a year earlier.

DesRosiers' numbers suggested that consumer incentives helped drive up sales of light trucks including sport utility vehicles and pickup trucks to75,131, a gain of 12.2 per cent, whilepassenger car sales dropped 10.9 per cent to 60,938.

In terms of year-to-date market share, Ford took first place with 17.2 per cent of the market; GM was second with 15.9 per cent; Chrysler was third with 13.4 per cent; Toyota was fourth with 11.3 per cent; and Honda was fifth with 8.5 per cent.

U.S. sales fall

In the U.S.salesfell for the most part, especiallysincelast year's August sales were boosted by the government's cash-for-clunkers rebates.

Sales of General Motorscars and light trucks totaled 185,105, a 25 per cent drop from 245,550 in August 2009 as the shaky economy discouraged customers from buying.

Ford's sales fell 11 per cent to 157,327 from 176,000 a year ago.

Chrysler Group sold 99,611, or seven per cent more, vehicles. With a lineup that includes fewer small cars, its sales last year were less affected the clunkers rebates.

The drop for GM and Ford is a worrisome sign because August is typically a strong month. Analysts say total industry sales could fall below one million new vehicles, making it the worst August in 27 years.

American auto sales in July were a strong point for the economy, helping to boost overall consumer spending numbers.

Recovery too weak

"There hasn't been enough horsepower behind the recovery to motivate consumers to regain their confidence and purchase vehicles at a higher rate," says Jeff Schuster, executive director of global forecasting for J.D. Power and Associates.

Car buyers are also struggling to find bargains.

Most automakers are making money at lower sales levels, because they've cut production. They no longer need to offer cars at below break-even prices just to move them off lots.

The average discount per vehicle fell three per cent in August to $2,681 US per vehicle, according to auto research website Edmunds.com.

Subaru'ssales fell 22 per cent in August. Honda Motor'ssales were down33 per centand NissanMotor'sdropped 27 per cent.

Small cars sold well last August because of the $2.8 billion clunkers program, whichgave government rebates to people who bought new vehicles with better gas mileage.