General Motors reported Wednesday that sales fell 25% in August as the nation's economic recovery appeared to stall and cautious consumers held back on buying cars. But despite the downturn, GM officials said they remain upbeat that the hard-hit auto industry will continue to improve in the months ahead.

For the month, GM said it sold 185,176 vehicles, compared to 246,479 a year ago, when most automakers were benefiting from the federal government's "cash for clunkers" program. Ahead of the release of last month's sales figures, analysts noted that comparisons to August 2009 would be skewed because of the boost in sales caused by the rebate program.

"Last year's 'cash for clunkers' program spiked industry sales higher in 2009, so results this August were, not surprisingly, a bit mixed," Don Johnson, GM's vice president of U.S. sales, said in a statement. "Importantly, three of our four divisions showed solid gains. This is further evidence that our performance is the result of balanced contributions across our brands."

Among its four core brands -- Chevrolet, GMC, Buick and Cadillac -- sales fell 10.6%. Year-to-date, GM said it has sold 1.465 million vehicles, up 5.4% from the first eight months of 2009.

GM reported sales at its Buick division rose 66% compared to a year ago, while those at Cadillac and GMC increased 83.1% and 12.3%, respectively. But Chevrolet, which benefited most from the "clunkers" program, saw sales fall 21.5%, to a total of 131,952 cars and trucks. Chevrolet is by far GM's largest division, selling 2.5 times more vehicles than the other GM brands combined.

Comparing results to July, GM reported sales fell 7.3%, marking the first time in 12 months that GM failed to post month-to-month sales gains.

Signs Point to Pent-Up Demand

Speaking on a conference call with analysts and the media, Johnson sounded an upbeat note about the fourth quarter, noting that the company still sees little risk of a double-dip recession.

Low interest rates and strong corporate profits, Johnson said, are helping to offset a raft of discouraging economic news of late, including last week's downward revision of second-quarter gross domestic product growth to 1.6% from the previously reported 2.4%.

Within the auto industry, Johnson said several signs point to a continuing recovery. The average age of the U.S. vehicle fleet has increased, he said. "This tells us that there is pent-up demand building, which will eventually be relieved when the economy gets a much firmer footing."

Johnson said data showing Americans are saving more is another indication of better economic times ahead. "This higher savings rate implies that households are making progress in rebuilding their balance sheets," which could lead to increased auto sales in the months ahead.

Keeping an Eye on the Chevy Cruze


GM was the first automaker to report monthly U.S. sales figures Wednesday. Others, including Toyota Motor (TM) and Ford Motor (F), are expected to report August sales data later in the day.

On Tuesday, GM said it had begun ramping up production of the 2011 Chevrolet Cruze, (pictured, above) which will start rolling into showrooms this month. The new compact car, designed to compete with rival models such as the Toyota Corolla and Ford Focus, is estimated to get 36 mpg on the highway when equipped with a manual transmission, according to the Environmental Protection Agency.

Analysts will be watching to see how consumers respond to the Cruze, which replaces the dated Chevrolet Cobalt. GM needs to compete effectively in the compact car segment as buyers seek to downsize to more fuel-efficient vehicles.

GM's Johnson said Wednesday that its dealers have fewer than 8,000 Cobalts in stock nationwide.

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83 Comments

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themanindbox

I think they owe all of us in the USA who pay taxes a free car. Since we all paid for one anyway.

September 10 2010 at 10:07 AM Report abuse rate up rate down Reply
dterraman

why worry, just stick it to the taxpayers

September 02 2010 at 5:04 AM Report abuse rate up rate down Reply
dawbn

They probably would sell more with cash incentives. The only ones they offer are on the non selling vehicles or the overstocked ones. People are needing the help also!

September 02 2010 at 3:46 AM Report abuse +1 rate up rate down Reply
toosmart4u

Hey quit listening to the rubbish in here. On the sticker it will tell you the final assembly lovation, the location of the engine and transmission were made. And where some of the parts came from. My 2008 Chevy was 95% American made. If you buy foreign you cannot complain about our national debt for you are adding to it.

September 02 2010 at 2:42 AM Report abuse rate up rate down Reply
1 reply to toosmart4u's comment
themanindbox

"Rubbish?" Yeah there is an american word. 08 Chevy what? I would like to look into that... They are all foreign, just different percentages. Even by you stating that your GM product is 95% made here, you are stating your GM product was 5% made elsewhere, meaning a 5% of the 100K plus versions of that car of truck was sent elsewhere. Meaning that 5% of the three or more year run of the car or truck would have paid for additional businesses and workers here in the US. If it is not 100% made, meaning all parts, and assembled here it is not american. I can care less what language the check is filled out in and what continent it is mailed to. Meaning, If Toyota sold a car here that was made 100% of american part, made by american people, and assembled there car in the US 100%, i would call that an american car. Even though the company is "Foreign".

September 10 2010 at 10:17 AM Report abuse rate up rate down Reply
rick

Ford, very quietly and as recently as the last two months has taken government backing for about eighteen billion in secured loans.

September 02 2010 at 1:00 AM Report abuse rate up rate down Reply
ednyberg

It is very silly not to support GM. They are building some fantastic product. We need to support US manufacturers & US Jobs. The two Buicks I own, one built in Michigan & one built in Ohio are without question the best I have ever purchased. In my driving years I my wife & I have purchased 26 GM products. If for whatever reason you don't buy GM at least buy from a US manufacturer.

September 02 2010 at 12:31 AM Report abuse rate up rate down Reply
1 reply to ednyberg's comment
themanindbox

Buick is as american as Hyundai, The 2011 Regal is exported from Germany to the US and is nothing more then a rebadged Opel Insignia. The fact that you have owned 26 GM products would tell me that they build Crap, unless you are 100. The Buick Allure, or Lacross are both developed in South Korea, they are rebadged Daewoo Alpheon's. They share the same chasis design with the Saab 9-5. The 2.4 Ecotech is a German made motor. The 3.0 is a South Korea Made motor. "Some american car" The 3.6 is designed in Port Melbourne Australia and assembled in Flint Michigan, the motor is from Holden motor Corp. the 2011 Buick Lucerne Is about as close to american as the Buick Name plate gives, the motors are designed and assembled in Tonawanda New York. However you should Note that Toyota provides the Variable valve timing computers for this car. So in essance is about as american as a camry. I can continue if you would like to know more. I have done extensive research into this.

September 10 2010 at 10:44 AM Report abuse rate up rate down Reply
ednyberg

It is very silly not to support GM. They are building some fantastic product. We need to support US manufacturers & US Jobs. The two Buicks I own, one built in Michigan & one built in Ohio are without question the best I have ever purchased. In my driving years I my wife & I have purchased 26 GM products. If for whatever reason you don't buy GM at least buy from a US manufacturer.

September 02 2010 at 12:30 AM Report abuse +1 rate up rate down Reply
ednyberg

It is very silly not to support GM. They are building some fantastic product. We need to support US manufacturers & US Jobs. The two Buicks I own, one built in Michigan & one built in Ohio are without question the best I have ever purchased. In my driving years I my wife & I have purchased 26 GM products. If for whatever reason you don't buy GM at least buy from a US manufacturer.

September 02 2010 at 12:30 AM Report abuse +1 rate up rate down Reply
Rick

I have pretty much owned GM trucks my whole adult life. After this fiasco that created "Government Motors", I will never buy another. I will probably buy Ford from now on. They deserve the business since they did not ask for a bailout and have made wiser decisions.

September 02 2010 at 12:20 AM Report abuse +2 rate up rate down Reply
1 reply to Rick's comment
dterraman

I feel that way too, but, FORD?

September 02 2010 at 5:05 AM Report abuse +1 rate up rate down Reply
electrix47

Where will your next GM Car be built, Mexico, Korea, Russia, China or Australia? GM small cars are mostly re-badged Korean Daewoo cars. Will your next BUICK by made in China? It's interesting that GM has been screwing over the salaried, hourly and closing North American plants for over 10 years. The major money is in manufacturing cars not servicing. If import companies can build NEW plants throughout the US why has GM shutdown most of its North American operations? Toyota has more truck building capacity in it's Texas plant then GM does nation wide. Who really cares anymore about GM. Gm was a leader in the Automotive industry for over 50 years. Through poor management, quality, economy and styling the imports and Ford have taken the lead. Please just let GM Die. GM is no longer good for the US.. I believe the new slogan, "Rice, sushi and taco's"! Leave out the American and Apple Pie! That is not being disrespectful, just reality!!

September 01 2010 at 11:43 PM Report abuse -1 rate up rate down Reply