GM, Ford Lose International Cushion As February Sales Fall
14 March 2009 - 3:17AM
Dow Jones News
The cushion U.S. auto makers once had in markets outside of
their struggling home country is shrinking fast as sales sink
around the globe.
General Motors Corp. (GM) and Ford Motor Co. (F) reported steep
sales declines last month in Europe, Brazil and Canada, with other
regions expects to follow suit amid a deepening global economic
slump.
European auto sales fell 18% in February, with only Germany
boasting gains following government incentives for buyers scrapping
old cars in favor of new.
GM, asking for billions aid from European governments, reported
a 22% decline, while Ford said sales fell 14%.
Until recently, global auto sales have been a haven for
Detroit's auto makers, faced with growing unemployment, a credit
crunch and the housing crisis at home.
Global auto sales fell about 3% in 2008 and are expected to sink
another 10% this year, according to forecasting firm IHS Global
Insight.
Operations in emerging markets that had been immune to troubles
in industrialized nations are showing signs of strain.
In Brazil, GM and Ford both reported sales declines in February
from the previous month, while overall sales notched up a modest
1%. GM sold 35,757 cars and trucks last month compared with 38,201
in January, while Ford sold 22,461 cars and trucks in February,
down slightly from 22,561 units in January.
Sales in Brazil have been helped by tax breaks for auto
purchases that run until March 31. GM last week reported sales in
Canada fell 57% from a year ago, hit by many of the same woes
dragging down U.S. sales. Meantime, the auto maker plans to scale
back production in Thailand, touching even GM's seemingly immune
Asia Pacific unit.
A GM spokesman said Friday that the company will temporarily
close a plant in Thailand this month to address excess
inventory.
-By Sharon Terlep, Dow Jones Newswires; 248-204-5532;
sharon.terlep@dowjones.com.