GM August Sales Reach 27-Year Low

August 31st, 2010 Brock Hailes Leave a comment Go to comments

General Motors released its sales report for August and it showed some of the worst numbers since 1983. According to the recently-troubled auto manufacturer, sales toppled 25 percent from a year ago, partially due to the Cash for Clunkers program of last summer.

GM Struggles to Sell

Despite the fact that General Motors has fought back from bankruptcy to see a $1.3 million profit in the second quarter, it is still struggling to sell cars. According to the manufacturer, August sales dropped 7 percent from just a month prior as tracked by Edmunds.com and TrueCar.

There are a few reasons that car sales have struggled for the auto maker:

Cash for Clunkers: The Cash for Clunkers program, which was very successful in moving cars with every dealer, left many with grim comparisons to make later. Many potential car buyers already secured their new car loan and are not looking to buy anything else anytime soon.
Nervous consumers: Those who did not purchase vehicles during the Cash for Clunkers program are just nervous about their ability to finance a vehicle during difficult economic times.

In addition, GM let go of four of its brands–Pontiac, Hummer, Saab and Saturn–which left the company with fewer cars to sell. For those it was left with–Buick, Chevrolet, GMC and Cadillac–sales dropped 11 percent from a year ago.

GM Refocuses on Subprime Lending

In an effort to boost sales, GM recently announced that it would get back into the subprime auto lending business. After purchasing subprime auto lending AmeriCredit Corp., the company decided to open its business up to those with less-than-perfect credit, especially since recent years have resulted in many responsible consumers suffering with lower credit scores due to the recession.

The company hoped that opening its auto lending to more consumers would increase sales and allow it to get back onto the New York Stock Exchange (NYSE).

While sales have struggled for GM, this is a good time to look for a car as we head into fall. GM and other automakers are now trying to get rid of their 2010 models as they bring in their 2011 vehicles. So if you’re looking for reasonable car financing, this may a good time to seek great deals.

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