Wednesday, November 03, 2010

U.S. Car Sales Top 12 Million Units in October for the First Time in Two Years, Except for CFC Month

Except for the "cash for clunkers" jolt that boosted car sales in August 2009 to an artificially high 14.17 million units (on a seasonally adjusted annual rate basis), auto sales in October reached a two-year high in October of 12.26 million vehicles.   That was the strongest month for auto sales since September 2008 when 12.52 million vehicles were sold.  Chrysler and Ford helped fuel strong October car sales with two of the largest year-over-year gains of 37% and 19.3% respectively.  As a whole, the industry registered sales gains of 17.5% in October compared to last year, following a September gain of 25.4%. Year-to-date car sales are ahead of last year's sales by 10.6%.   

Although there still's a long way to go before car sales reach the pre-recession levels of  16-17 million units per year, there's been a lot of progress in the last 20 months - October sales of 12.26 million car sales were more than 3 million units above the cyclical low of 9.14 million autos sold in February 2009. 

2 Comments:

At 11/04/2010 9:53 AM, Blogger morganovich said...

of other interest, an additional GM bailout has emerged as their financials become clear for the roadshow.

turns out that, counter to standard BK practice, GM gets to keep its $45 bn tax loss carryforwards. this means they pay no tax for the foreseeable future.

this is an ugly and sinister form of financial legerdemain.

no taxes boosts reported EPS, running up the stock price and fattening union coffers. this will make it look like the stock sold by the government is getting a good price and "paying off the bailout".

but from whence does this money come? why, the taxpayer of course. GM will get an extra $45bn in profit at the expense of the general fund which would have received the money.

they are literally taking the money from one taxpayer pocket and putting it in another and calling that a payback.

worse, it's a lossy situation. only 60% of the benefit falls on government stock. the rest will go to the unions and the few surviving private holders.

so it's not really taking money out of one pocket and putting it into another, it's taking the money out, giving 40% to someone else, putting the rest back in your other pocket, and calling it a payback.

there really seems to be no end to the double-dealing and favoritism in this BK.

this is EXACTLY why you should never let the government become the majority owner of industry like this (or likely an owner at all).

even if all the stock is sold off and pays for the initial bailout, there will still be this additional $45bn.

talk about 2 bites at the apple...

 
At 11/04/2010 4:46 PM, Blogger Walt G. said...

morganovich,

According to the WSJ, the $45 billion in tax carry over that you mention is correct, but the tax reduction will be in the $15 to $16 billion range. It sounds like the $45 billion would be like your income and the $15 to $16 billion would be like the tax owed on that amount only in reverse (you get the credit instead of pay). I'm not an expert in this area (or any area as you have noted in the past).

As a taxpayer I am outraged, but as a new GM stock owner in a few days, and a UAW retiree next year, I'll take the money and run because I don't have any more morals than the CEOs who take millions from a company that they bankrupt and leave. It's about time that the little guys get just a few dollars of what the big bankers and CEOs get.

 

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