General Motors Corp. has been bumped off its perch as Canada’s top-selling auto-maker, marking a historic redrawing of the country’s auto hierarchy as buyers fretting about the economy opt for the cheapest car that will fit their needs.
During a month in which total industry sales fell 28%, Chrysler LLC toppled GM in February to become number one. It was the first time since 1949 that GM has been outsold by a rival, industry consultant Dennis DesRosiers said.
That year, GM design chief Harley Earl was perfecting the world’s first cars with tail fins, inspired by Second World War fighter aircraft.
Ford Motor Co. also nudged past GM in February, which stood third with sales of 11,417, according to industry data released yesterday.
GM maintained its lead in overall sales in the year to date.
While the once-large gap between GM and its Detroit competitors is wiped away, foreign-based manufacturers also continue to close in on North America’s home-grown automakers. Hyundai Motor Co., riding a weak Korean won that is allowing it to lower prices, tallied a 30% gain last month in Canada. It sold more cars than Honda Motor Co.’ s main Honda brand.
General Motors’ sales tumbled 53 percent from a year earlier, while Ford’s U.S. sales fell 48 percent. Toyota’s sales fell 40 percent, and the other major Japanese automakers were only slightly better.
The slide casts further doubt on the financial viability of GM and Chrysler, which planned to report its sales later Tuesday. They need to sell cars and generate critical cash to supplement the $17.4 billion in government loans that are keeping them in business.
Automakers and analysts have been predicting sales will rebound in the second half of this year, but they are becoming less certain. Massive layoffs, the stock market decline and sliding home values are prompting people to hold on to their cars longer, while those who are buying are more often opting for a used car or truck.
Emily Kolinski Morris, Ford Motor Co.‘s top economist, said retail sales to individuals had been stable for four months but dropped in February, indicating that last month may not be the bottom for auto sales.
The trough is likely even though automakers spent more on rebates, low-interest financing and other incentives in an effort to bring out buyers. But despite the fantastic deals, sales continued to slump.
“If it wasn’t for the generous level of incentives now, we probably would be seeing even lower sales, if you can believe it,” said Jesse Toprak, executive director of industry analysis for the auto Web site Edmunds.com. “It seems it can’t get lower, but it could.”
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