Asian Rivals Step Up Pressure on US Car Makers

05 May 2005

There seems little US carmakers can do at the moment to halt falling sales and the onslaught from far eastern competitors.

General Motors and Ford Motor Company both reported significant falls in April. The nation's biggest manufacturer, GM, saw its sales sag 7.4%, while Ford sales fell 5.1% over the same period last year.

Japanese rivals Toyota and Nissan, on the other hand, can do no wrong in the US. Toyota boasted a 21% rise in April while Nissan did better yet, increasing its sales by 27%.

The downturn in US carmakers' fortunes can be blamed partly on more expensive fuel, depressing demand for gas-guzzling SUVs, once so beloved by macho motorists of both sexes.

Into this gap have driven hybrid cars, such as Toyota's Prius brand, which runs both on gasoline and electricity. The company sold 11,345 Prius models last month, more than tripling the year-ago tally of 3,684.

The nation's demographic is also changing as aging baby boomers no longer want large, truck-based SUVs and choose smaller vehicles.

However both Ford and GM are optimistic of an upturn in their fortunes as new models arrive at dealerships.

Says Mark LaNeve, GM's vp for North American sales, service and marketing: "We are beginning to show significant year-over-year gains with our launch cars compared to the models they replaced."

Data sourced from BBC Online; additional content by WARC staff