Ford models among top sellers in cash-for-clunkers deal

The nation's carmakers are bracing for quieter showrooms and slower sales this autumn after the cash-for-clunkers programme offered a big but unsustainable boost last month.

United States sales of cars and light trucks rose to 1.3 million last month, a roughly 30 per cent increase from July. It also was the first monthly year-over-year gain since October 2007.

Ford, Toyota, Hyundai and Honda were the big winners as consumers snapped up their fuel-efficient cars.

Rivals Chrysler Group LLC and General Motors endured another month of falling sales, although their high-mileage vehicles did better.

But the August industry gains could quickly be followed by a slowdown this month and for the rest of the autumn, carmakers and analysts warned this week.

Although the clunkers programme succeeded in bringing in new buyers, a large portion were people who planned to buy vehicles later in the year.

Now the question is whether carmakers will need to roll out an expensive new round of rebates and low-cost financing to spur sales.

Cash-for-Clunkers, which ended on August 24, drew hordes of buyers into quiet dealerships by offering up to US$4,500 ($6,600) towards new, more fuel-efficient cars and trucks. The hefty rebates gave carmakers and dealers a much-needed lift, spurring 690,114 new sales, many of them during August, at a taxpayer cost of $2.88 billion.

Several carmakers said their supplies plummeted during August, especially for their fuel-efficient models. That could make it harder for customers to find the exact model they want.

Still, the coming months might offer some stability in a car sales market that's been floundering for more than a year. Even before the programme began in late July, sales were showing small signs of improvement.

Last month's car sales got a boost from the Government's Cash-for-Clunkers programme, although results for American carmakers were underwhelming, reports Brian Williams from NBC.

"We believe the fourth quarter will be better than the second quarter", as the broader economy shows signs of recovery, said Ken Czubay, Ford's vice- president of US marketing and sales.

August sales at Ford totalled 181,826 cars and light trucks, up 17 per cent from a year earlier, when high gas prices and growing economic uncertainty kept car buyers at home.

Two of Ford's vehicles - the Focus and Escape - ranked among the top selling cars under the clunkers programme. Sales of the Focus rose 56 per cent and those of the Escape small sport utility vehicle climbed 49 per cent. In another sign of a strengthening economy, sales rose for Ford's pickup trucks, which are popular among contractors and other small businesses.

Ford's F-Series rose nearly 13 per cent. Those results, and a 57.4 increase in Ranger sales - a small version of the F-150 - may reflect that the "toughest part of the recession, the most dramatic declines" are over, the company said.

Japanese carmakers Toyota and Honda also posted gains year-over-year last month. Toyota sales rose 6.4 per cent to 225,088, lifted by small cars like the Corolla, the best-selling clunkers vehicle.

Honda sales rose 9.9 per cent to 161,439, while sales at Nissan Motor Co. slipped 2.9 per cent.

At General Motors, sales fell 20 per cent to 245,550.

GM vehicles like the Chevrolet Aveo subcompact, the Cobalt sedan and Equinox crossover got a lift from the clunkers programme. No GM vehicles made the closely watched list of top-10 Cash for Clunkers sales, but GM's share of clunker purchases were second only to Toyota.

Meanwhile, low supplies of fuel-efficient vehicles at Chrysler kept it from benefiting more from the clunkers programme.

To make up for the shortfalls, Chrysler is boosting production by 50,000 vehicles of most of its vehicles through the end of the year.

Chrysler sales fell 15 per cent to 93,222 units.

That was less than the combined sales of Hyundai Motor America and affiliate Kia Motors America, whose smaller sedans helped boost sales to a combined 100,665 for August.

- AP