MercoPress. South Atlantic News Agency

US July Ford, Subaru and Hyundai sales up; GM Chrysler down

The US scrappage program “cash for clunkers” has had a positive effect

United States vehicle sales were mixed in July, with Ford seeing sales rise compared to a year earlier while both Chrysler and GM posted a fall. Asian car manufacturers also saw varied US sales, with Subaru and Hyundai sales up while Honda and Toyota both posted falls year-on-year.

While the results varied significantly, the government's scrappage scheme has been credited with improving sales. But analysts are worried that any improvement could be short-lived.

The US government's Car Allowance Rebate System (CARS), dubbed the “cash for clunkers” scheme, gives owners of old cars and trucks cash towards a new, more efficient model in exchange for their old vehicles.

“It has psychologically had a huge positive effect for the industry, which is what is needed,” said Tom Libby, an independent auto analyst.

But White House spokesman Robert Gibbs said the “cash for clunkers” scheme would have to end if the Senate did not increase funding for it this week.

Congress gave the scheme the go-ahead in early July, but the government looked into suspending it amid fears huge demand would exceed the available funds of one billion US dollars allocated for the rebates.

Car giant Ford saw July's US sales up 2.3% from a year ago while Chrysler saw sales fall 9.4% and GM shed 19% during the same period.

The Ford group - which includes the Ford, Lincoln, Mercury and Volvo brands - sold 165,279 vehicles last month.

Ford is the only one of the “Big Three” US carmakers not to have filed for bankruptcy protection.

GM, which recently emerged from bankruptcy, saw sales fall last month compared to a year earlier but said retail sales climbed for the fifth month in a row, helped by the “clunker” scheme. GM sales fell to 188,156 while Chrysler sales fell to 88,900 vehicles for July.

Peter Fong, president of the Chrysler brand said: “The government's programme is doing what it is designed to do - spur consumers to trade in older gas guzzlers for new, fuel-efficient vehicles.”

“While we don't expect the industry sales forecast to change dramatically, we are seeing encouraging signs that consumer confidence is building, and more consumers are considering purchasing a new vehicle,” he added.

Among leading Asian automakers, sales for Subaru rose sharply, adding 34%, while Hyundai added 12%. In contrast Toyota Motor sales shed 11%; Honda declined 16% and Nissan Motor dropped 25%.

German firm Daimler saw US sales shed 24% last month, hit by lower sales of its Smart minicar and Mercedes-Benz luxury models. (BBC).-