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Automakers See Sales Down, Inventory Up
01:00 p.m. EDT, February 04, 2009

In a survey of analysts conducted by Automotive News, figures for auto sales in the United States in January were estimated to remain at 25-year lows for the fourth consecutive month.

Due to reduced fleet sales, General Motors will likely post its lowest sales August 1982. Chrysler is expected to repeat its December drop of 50 percent from 2007. Both companies are currently at work on viability plans to be presented to the U.S. Department of Treasury as a condition of their $13.4 billion in federal loans.

Ford, still operating without assistance from the federal government, will likely post a drop in sales of roughly one third according to analyst estimates. Edmunds.com sees Honda dipping 26 percent, Toyota 27 percent, and Nissan 31 percent.

These numbers suggest that demand did not hit the bottom in November as many had hoped, signaling rough sailing ahead for the auto industry as it labors to recover from its worst year of sales since 1992.

In an effort to control rising inventory, production in North America has been cut 64 percent from the levels of one year ago with more cuts planned in the immediate future. Honda has cut production for the current quarter by 14 percent. General Motors did away with 2,000 production jobs and is temporarily closing a number of plants.

Still, the auto industry opened 2009 with a 94-day supply of vehicles, a figure more than 50 percent above the number analysts recommend for the start of the year.


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