Latest sales reports by world’s automakers showed that foreign cars outsold domestic brands in the U.S. market for the first time as sales by the Big Three nosedived.

Trouble in the U.S. housing market has spread to car dealer showrooms, with worrying implications for the broader economy, and Detroit is no longer the carmaker of choice for the majority of Americans.

Total car and light truck sales in the United States fell 12.3 percent in July. With sales of foreign models off 5 percent from July 2006, the falloff for the Big Three — General Motors, Ford and Chrysler — was a much bigger 19 percent.

Foreign cars accounted for almost 52 percent of July sales, although the milestone might not be very meaningful in an industry that is increasingly globalized, industry analysts said.

Peter Morici, an international trade expert at the University of Maryland, said the Japanese and then the Koreans needed years to learn how to make good cars to grab a significant share of the U.S. market. And “it’s not going to take the Chinese that long,” he said.

There will still be the occasional quarter when GM shows more black on the books than Toyota [not the most recent, though] – or the Big 3 crawl back above 50% – but, for the near term, results like that will only reflect selling-off profitable assets.

Paying attention to what people need, maybe even before they realize it themselves, is what puts a company in command of their market.



  1. Jägermeister says:

    This is like beating a dead horse… But hey…. Make cars people want… not low-quality and low mpg cars that look pretty but fall apart right after the warranty expires.

  2. moss says:

    Another one of those sad but seemingly inevitable milestones in the decline of American industry. In a truly global economy, the money-boys have no interest in the “where” of their accumulating wealth. And even less interest in the diminishing share for folks who don’t earn their living as investors.

  3. OvenMaster says:

    As soon as American car makers go back to building reliable cars at affordable prices, things will turn around.

    In short, when Hell freezes over.

    Just wait til the Chinese car makers get the bugs out of their cheap cars. That will be the final nail in the American automotive industry’s coffin. They could have even blatantly copied Japanese cars starting in the 70’s, but they didn’t want to be bothered. Now this head-in-the-sand attitude is coming back to bite them all in the ass.

  4. Mark Derail says:

    Let’s see…

    More American cars are made with parts from China & Japan.
    Assembled in Mexico.
    The owners of these public companies, through stocks, are from around the world having invested in Mutual Funds.

    So what’s so American of American cars?

    Buying an American car really gives how much money back to Americans?

  5. Mark Derail says:

    Why, not so long ago, you could do this :

    http:// [car manufacturer or car name] + SUCKS.com

    Rather than fix the problems with their cars & brands, the Big 3 sent lawyers after the people that registered these domain names, Cease & Desist.

    All of a sudden regular people were not allowed to express their honest opinion publicly.

    I read most of those sites, with true stories (some horror) of real bad manufacture and lousy after service.

  6. TIHZ_HO says:

    Did you know that in China mid size Buicks and Fords are very popular with many Chinese business people and upper middle class executives? Shame they aren’t imported from the US though.

    Also I have been seeing a few Chrysler 300Ms and the occasional Caddies tooling around Shanghai – sans spinners. Can’t say if they are imported or not – but I think not.

    Well…don’t worry, give it few years and ALL cars in the US will be imported including the American makes…so it seems.

    Cheers

  7. Higghawker says:

    Here is part of the problem:

    40 percent hourly cost differential looms large. It is far smaller than the gap in senior executive pay for the Detroit Three and Japan’s own Big Three.

    A 2006 study by economists at the University of Indiana concluded that Japanese CEOs earn one-third of the pay of their U.S. counterparts. The economists used tax records to estimate the pay of the Japanese executives.

  8. hhopper says:

    The last American car I owned was a 1972 Chevy Nova, which I bought new. What a POS! The air-conditioning crapped out right after the warranty was over and was too expensive to even fix. I live in FL so that really sucked. So many other things went wrong with it I can’t even list them all here.

  9. Angel H. Wong says:

    Hopefully the folk from Cerberus will shake Chrysler enough to put it back on the right track.

    Of course, that’s just being naive.

  10. ECA says:

    I have a 20 year old OLDsmobile, that still gets 30mpg on the hiway, and LOVES speeds around 75…

    The US company’s OVEr produce, OVER charge, and are failing to Bring up QUALITY and advancements.
    The USA gov has been TRYING to protect these USA concerns, by Banning and forbidding foreign cars THAT BEAT the USA cars from being sold here.
    Its the same with MOST of the corps…
    If they would DROP CEO, Board member/ corporate wages in 1/2…Their corps would BOOM, and could be advanced and GROW more….
    Who has seen a Sunflower grow…
    Its a neet process, but as the HEAD expands, it gets so HUGE it dips and falls…

  11. Nekkes says:

    I am probably not the right person to comment on this since this is partly a matter of taste and I am not from the US. However, I cannot resist the temptation….. Based on my subjective opinion: US manufacturers design cars that feel like plastic (inside and out), have horrible design!, give horrible mileage and simply are unreliable.

  12. ECA says:

    I like the promise of the late 70’s and 80’s..
    Smaller
    Better
    Aluminum
    Lighter, faster better, more expensive.

    They built a small car, out of aluminum, found it that it DODNT protect anything(it was tin foil), after reinforcing EVERYTHING, it was almost as heavy as the originals, that were made from Steel. So they Aimed at the engines, and made 1/2 of it from aluminum, WHICH isnt a nice thing, to make a engine of 2 different metals as heat changes there form in different speeds, and fashions.. then made the engines SMALLER, thinking that SPEED, was better for a car, then useing Torq, as the old cars converted Torq to speed, but didnt ADD a decent transmission, they used a 3 speed insted of a 5 speed(until recently)..
    Those Small aluminum cars didnt do any better then the OLD ones did…20-27mpg…
    When all they needed to do was lighten the Steel cars abit, and place a better transmission, preheat the compress the fuel and they would have made a better car out of the OLD ONES….

    Lets look at what could be done to an OLD Rambler and 15-18mpg…
    Fuel injection(increases mileage)
    Fuel compression(more air, uses less fuel)
    Synthetic oils to increase compression(last longer, and higher temp to degrade)
    Fuel preheating(expands fuel, mix with air and fires better, uses less fuel)
    Electric fuel pump…

    these alone would cost you about $3-4000, and the car would PROBABLY get at least DOUBLE the mileage…AND still be able to drive a car, that was as strong as a TANK.

  13. TIHZ_HO says:

    What is the difference between American businesses and Asian Businesses and IMHO why the big three are losing the battle in the states.

    A company from our group been talking to several (larger) American companies to distribute product in America for about a year and a half now. The communication process with the American corporations was enthusiastic and quick at first and then became very slow up to 3 months for a reply. Well obviously they aren’t really interested in us, the product or the deal so we thought and we told them that.

    The replies which eventually came were quite the opposite – they are VERY interested only as the deal progressed more people became involved in the decision making process – for one company up to 23 people have to sign off and have meetings for every emailed reply of ours (WTF?)

    So the months dragged on until at one international show in Germany 2 months ago some business men from India popped in who have a company in America. That afternoon we outlined an agreement and last month our first container of product was sold to them (with a larger order pending this month).

    We asked them how was it so easy to make the deal with them for the American market while even after a year and a half with American companies we are still getting nowhere?

    “Oh that is simple” they replied “They are stupid” was their answer.

    They explained that management of their company up to the CEO knows the business inside out and has started from the ground up. BUT American top executives are hired gun professional managers who are not from the industry the company they manage is in. These professional managers rely on reports, market analysis, accounting statistics and so on before they make a ‘smart’ business move.

    The Indian business people knew the market, knew the business from the ground up and were able to come to a decision and moved on it quickly while the American executives are still calling meetings and doing market analysis and being productive – think Dilbert (where do you think Scott Adams gets his inspiration from?)

    We haven’t told the American companies that we already did the deal. so next month or so when we get our next reply we will forward it to the Indians and let them handle it. As John “Hannibal” Smith from the A Team would say “I love it when a plan comes together.” 🙂

    Cheers

  14. Misanthropic Scott says:

    Nice Edsel. My mother is right. That front end does look like a gaping vagina. I’m surprised more of those didn’t sell.

  15. Misanthropic Scott says:

    BTW, let’s not forget that GM had the edge for a short time. They built a car so good Japan got nervous. Toyota responded by creating the electric drive components used in today’s Prius.

    Really? What was the car? The EV-1. But most people never even heard of the EV-1, what was it? It was a wonderful electric car, fast, sleek, and sexy. It was a corvette for environmentalists.

    But, GM only leased them. At the end of the lease, they took the car back … AND CRUSHED IT!! And, never produced it again. See Who Killed the Electric Car? for details, available on netflix.

  16. Axtell says:

    Wow, 15 posts and not a single post stating that unions are to blame…nice work.

    And of course foreign automakers are going to outsell domestics. The ‘big 3’ have turned to the same formula for new cars over and over: bigger and bigger motors, more hp, worse mpg. No wonder they’re dying.

  17. TIHZ_HO says:

    #16 How is that true Axtell? That is a common war cry but that is all it is – not a Republican are you?

    IMHO American business management = Dilbert


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