carsAuto sales started out August on an upbeat note, with early trends showing the month could go down as the best so far this year. But as August winds down, it appears consumers were less eager to buy than first thought, despite the bevy of end-of-model-year deals.

In fact, August could go down as the slowest sales month in 28 years, Bloomberg News reported. Industry-wide, automakers are expected to report Wednesday that monthly sales totaled an annualized rate of 11.6 million vehicles, according to a composite estimate of eight analysts.

The last time auto sales were that low was August 1982, when the nation was mired in recession, according to researcher Ward's AutoInfoBank. The rate is also 18% lower than the 14.2 million pace recorded during last year's "cash for clunkers" rebate program, which boosted purchases and made August one of the best sales months in 2009.

Market Distortion From Cash for Clunkers

People aren't buying because of the economy. With recovery seemingly stalled, Americans aren't eager to take on more debt when their jobs may be at risk. Reduced home values and lower stock prices are also hampering auto sales, since households feel less wealthy.

Edmunds.com reports similar sales expectations for the month. The online car-buying guide predicts sales in August reached an annualized rate of 11.8 million, up from 11.5 million in July.

Comparisons between the current month and August 2009, are "a waste of time since 'cash for clunkers' distorted the market so badly last year," said Jessica Caldwell, director of industry analysis for Edmunds.com. "It is likely that the current slow sales pace can be partly attributed to the thousands of 'pull-ahead' sales that last year's CARS program stole from subsequent months."

Despite a 1% boost in incentives for the month compared to July -- to an average $2,864 for each vehicle sold -- retail sales likely fell 7% in August compared to the previous month, according to industry tracker TrueCar.

Leaders and Laggers


TrueCar forecasts sales at Ford Motor (F), Toyota Motor (TM), Mercedes-Benz and Honda Motor (HMC) rose during the month compared to July, with Mercedes and Honda each recording a 10% increase, while Ford's sales climbed 5.6% and those at Toyota grew just 1%. Japanese automaker Mazda Motor may have enjoyed the best increase, with expectations that its U.S. sales jumped 21%, compared to July.

General Motors, Chrysler Group, Subaru and Hyundai Motor are expected to report flat sales, with Nissan Motors (NSANY), BMW, Kia Motors and Volkswagen each reporting fewer vehicles sold.

Honda sales appear to have benefited from increased discounts and Toyota's continuing recall woes. Honda boosted incentives by 66% from a year ago, Bloomberg reported, citing TrueCar data, while Nissan and Toyota raised discounts by less than half that amount.

Among domestic automakers, GM and Ford both increased incentives -- 18% and 25%, respectively, in August, compared to a year ago. Chrysler, however, bucked the trend, reducing discounts 22%, compared to August 2009.

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MSmailbox

It's very difficult to tell what a US car is, anymore. Components come from all over the globe, but it also means that the very best components go into each car built. Even when I was working inside a GM plant (85-94), we used Bosch brake components, because the Germans did it best. We used Japanese electronics, because the Japanese did that best. We used Bose speakers, wherever they came from. You know what? We used American workers to assemble those cars, just like Honda assembles Accords, in Ohio. OK, who can say what an "American car," really is? I don't know the answer, to this one.

September 01 2010 at 6:25 PM Report abuse rate up rate down Reply
Fred

The US car makers haven't learned a darn thing, they still put out rattle traps and gas eaters and have raised their prices, I am betting they will never learn.

September 01 2010 at 5:27 PM Report abuse +2 rate up rate down Reply
geomehm

August 1982 - The bottom in the stock market with the DJIA below 1,000.

September 01 2010 at 5:13 PM Report abuse rate up rate down Reply
jokesl3

I am a Ford retiree, I'm still driving my old Fords. The new ones just cost too damn much.

September 01 2010 at 5:04 PM Report abuse +2 rate up rate down Reply
Tommy

Really, the worst in how many years. I went to a chevy dealer to trade for a new pick-up, $47000.00 ("Duh" I don't think so). In 2008 the same truck was around $30,000. I Wonder when we'll have to bail them out again.

September 01 2010 at 3:25 PM Report abuse +3 rate up rate down Reply
ddan8719

the american consumor will never fully support the american car market in the numbers needed to maintain a profitable, viable, bussiness.sadly they are entrenched with any-thing asian owned and made..this country was doomed 20 years ago when the japanese flooded this country with there products..You see 30 years ago as an employee of general motors i hosted a party of around ten japanese engineers on how starters and generators are made..never thinking that one day they would close this giant automaker down..but with the contined support of the un-educated american public they will indeed succede.

September 01 2010 at 12:12 PM Report abuse +4 rate up rate down Reply
1 reply to ddan8719's comment
jantlowe

Maybe the car sales are doomed because the unions over paid & over priced. We always bought GM & Ford products.....until they become junk cars.

September 01 2010 at 1:20 PM Report abuse rate up rate down Reply
cpo1514

Would you buy a car/ used car from this administration???? Atta boy Joe... love the recovery. November the first team will be voted into office and the 'wanna be's' can go back to Socialism school (college tenures).

September 01 2010 at 11:54 AM Report abuse +3 rate up rate down Reply
buggy62

Well, duh!!! How many "real" people are willing to plunk down $20k, $30k, and even $40k for a new car? Why pay almost as much as you'd pay for a house? We bought 2 hybrid cars (the original Honda Insight for $20k each), and estimate they're saving us $300-$400/month in gas alone (55mpg and 65mpg respectively). Now, the same company wants $25k or $30k for a car that gets only 45mpg? GET REAL!!! Even the new Nissan Leaf is unaffordable, not to mention the electricity prices. I've been getting 45mpg+ since 1987, but as soon as a fuel efficient car is made, either they ruin it by "making something the customer wants," or ruin the gas mileage. GET A CLUE, Honda, et al!!!

September 01 2010 at 11:46 AM Report abuse +1 rate up rate down Reply
mrmuffinmanvw

I know everyone has there own opinon on buy american that would be the biggest joke of all when it comes to cars. I watched a show about the camaro built in a factory by robots in Canada, very few workers mostly inspectors. The only thing that tops that is all the engines and transmision's are made in yet another plant in Canada. How could you possibly think this is a american car??? In my opinon the whole car selling prosess needs a huge overhaul. I would like to think the car buyer is getting smarter by not buying into all the hype of owning a new car or [bill every month]how ever you look at it. I know for a fact I am done with car dealers no one gets a good deal from them, but they will sure try to make you believe that you did. Need a different car buy from a private seller thats how you buy american and put the money back into someones pocket that may need it. Thats all I have to say about that.

September 01 2010 at 11:44 AM Report abuse rate up rate down Reply
2 replies to mrmuffinmanvw's comment
ddan8719

Even though this car is made in canada genuis..the profits return to general motors bank account in this country..wher-as anything asian be it made here or not..the profits return to japan or korea..supporting there economy..this is the reason the american car makers are still faceing doom..the asian car buyer really beleives there money stays in this country because the product was assembled in this nation..WRONG GENUISES..

September 01 2010 at 11:56 AM Report abuse +6 rate up rate down Reply
Jim Guy

Hey Dan, Let me get this right. If I purchase a foreign car made in this country every penny I spend goes to "that" country??? and you called the other poster a genuis!!!!! Is that plant not using utilities from the US? Is that plant not paying taxes to the US? Is that plant not providing jobs? In the plant, to the lots,, at the lots, in the service area of the lot, at the sales desk, at the lobby desk, at parts stores. and all of these people are buying things to use in their lives, right here in the US... Would I perfer a US made car, 100% US company? sure, but I can not afford it now or when it breaks down. Fortunantely that is changing, but the guy on the line cannot make $80,000 per year unless the cars sell and for more money than you are willing to spend......Go unions!!!!!the only winners here

September 01 2010 at 12:13 PM Report abuse -1 rate up rate down Reply
wongtpa

I thought Obama's bailout saved the auto industry. Another liberal media lie. Ford is the only auto maker on solid ground! Government Motors is failing and the Volt will be the final blow. Thanks Obummer!

September 01 2010 at 11:43 AM Report abuse +3 rate up rate down Reply