by Calculated Risk on 4/01/2008 04:36:00 PM

From the WSJ: Auto Makers Report Slump in March Sales

... General Motors Corp. report[ed] a 19% skid in U.S. sales of cars and light trucks.

Toyota Motor Corp. ... reported a 10% decline, while Ford Motor Co. had a 14% drop. Chrysler LLC's sales tumbled 19% last month.

A quote from MarketWatch: Double-digit declines rattle top automakers

"This is a very challenging external environment, reflecting a seismic shift in consumer preferences. I'd like to be able to tell you that the worst is behind us, but I really can't give you that assurance."
Jim Farley, chief of Ford's marketing division.

Falling construction spending and employment means fewer people are buying light trucks (a highly profitable segment). With record gasoline prices, car buyers are shifting to smaller, higher gas mileage - and lower profitability - cars. And the credit crunch is making it more difficult for some to obtain a car loan. And for many homeowners, the "home ATM" is closed as a borrowing source for cars.

Mix in a generally weaker economy and more unemployment, and you have a perfect storm for the auto makers in 2008.