Gm's Hit With Biggest Monthly Sales Decline in June

General Motors Corp.'s woes continue as its sales plunged in June no thanks to the ongoing sagging demand for its small cars and to Toyota Motor Corp.’s aggressive discounting which hurt sales of GM pickups.

GM suffered the biggest monthly decline among the major automakers, with sales down 21.3 percent in a market that was slightly weaker than the previous June.

Fellow Detroit automaker Ford Motor Co.'s sales were down 8.2 percent, for an eighth consecutive monthly decline, and DaimlerChrysler AG's sales slipped 1.8 percent.

It was a different story though, for Japan's leading automakers which all reported big gains.

Toyota put the Tundra’s launch back on track with big discounts. A report by Edmunds.com said that demand for the giant Japanese automaker’s first full-size truck wasn’t meeting the company's annual sales target of 200,000 units but it all but turned around after Toyota offered no-interest loans and other incentives amounting to $5,083 per pickup. The move resulted in Tundra sales that more than doubled to 21,727 last month.

"The only large truck with a higher level of incentives in June than the Tundra was the (Dodge) Ram," said Alex Rosten, manager of pricing and market analysis at Edmunds.com. "Everybody else was lower."

Meanwhile, GM's truck sales dived 22.9 percent – this despite the incentives offered by the automaker averaging less than $3,700 last month to its relatively new GMC Sierra and Chevrolet Silverado pickups. Sales of the GMC Sierra pickup fell 26.5 percent, while sales of the Chevrolet Silverado declined by 23.5 percent.

In contrast to its bigger Detroit rivals, Chrysler reported a 58.2 percent climb in car sales, reflecting big gains for the Chrysler Sebring and 300 sedans, while its light trucks volumes dropped 14.9 percent. Chrysler's overall sales were down 1.4 percent.

It was the U.S. market's shifting away from trucks and toward more fuel-efficient cars that helped Japan's leading automakers. As of last month, car sales accounted for 49.3 percent of light vehicle sales, up from 47.7 percent in 2006.

Sales of Honda Motor Co. – also maker of top of the line Honda antenna mast, climbed 11.5 percent in June, while Nissan's numbers jumped 22.7 percent, thanks to the strong sales of its Altima and Sentra cars.

Toyota continues to gain momentum, as its sales increased 10.2 percent to 245,739, putting it just 200 units behind Ford in June. The giant Japanese automaker’s Yaris, Camry and Prius gas-electric hybrid cars all recorded strong sales gains as gas prices averaged more than $3 a gallon.

U.S. passenger car market held steady in June, edging up 0.2 percent. GM's car sales however, were down 20.1 percent.

Some industry analysts attribute the low sales to some of GM's small cars which are aging and others which are not competitive.

GM seems to already know this is the case, "It's a category where we haven't been doing as well as we should be," Paul Ballew, GM's director of industry analysis said.