U.S. auto sales plummet in June

Most major carmakers saw double digit percentage drops for their June U.S. sales levels as consumers continued to shift away from gas-guzzling SUVs and pickups and seek out more fuel-efficient compact cars and hybrids. GM saw its sales drop 19% in June on the back of a similar result in May, while Ford’s sales dropped 28% and Chrysler’s sales dropped 36%. Even Toyota, which sells a range of compact models and hybrids, saw its sales drop 21% as it struggled to meet demand for its more fuel-efficient models and cope with flagging sales of its SUVs and pickups.

Total June U.S. light-vehicle sales were down 18.3% from a year ago, and for the first six months of the year sales are down 10.6% for the same period a year ago.

The results demonstrate the rapid shift in buyers' preferences toward cars, spurred on by fuel prices that continue to top $4-a-gallon, industry analyst Alan Baum explained to Bloomberg. The poor sales result is the combination of the record fuel prices and the weakest economic growth in five years, and has seen this year’s annualized sales rate drop to just 13.6 million vehicles – the lowest since 1993.

People still want to buy new vehicles. The only problem is that the vehicles people want are in short supply because the industry has had such a short time to adjust to the demand, Baum explained.

Honda, Hyundai and Volkswagen, all saw their sales rise by about 1% through June, and after outselling U.S. carmakers for the first time in May, Asian companies repeated the result in June as well. For the second straight month, Ford's F-Series pickup, traditionally the best-selling vehicle in the U.S., was outsold by four cars: Toyota's Corolla and Camry and Honda's Civic and Accord.