2009 March Auto Sales: Still on Hold

To the surprise of absolutely no one, auto sales in March were dismal, again. Any month that sees the stock market fall back onto its face, job losses surge (especially among white-collar workers), and renewed talk of bankruptcy for GM and Chrysler isn't going to be a month when droves of consumers suddenly decide to rush down to their local dealerships with fistfuls of cash in hand. Industry-wide, sales were down by 37% compared to a year ago, but what few people remember is that March 2008 sales weren't so great either, off by 12% from the prior year. What's striking about this March is that there's been very little change in the mix of which models are relatively strong and which are practically sale-proof, as we'll see when we compare the March '09 sales figures and those for the first three months of the year.

Anyone looking for signs of improvement does have a few straws to grasp. The annualized selling rate in March was 9.8 million units, which is a long, long way from where we had been in recent years (annual sales in the mid teens) but is slightly better than the 9-million-unit year that January and February portended. Also, GM and Ford adopted Hyundai-style sales promotions that provide new-car buyers some measure of protection should they lose their jobs (a very real fear among American workers), and a late in the month uptick in showroom traffic suggests those might be having some effect. We'll see whether April brings real signs of awakening in the long-dormant new-car market.