• by Karl Greenberg , September 4, 2008

In yet another disappointing month for the auto industry, August saw total U.S. sales of 1.3 million units, down 15% versus last August when the industry sold 1.5 million units.

But Chrysler and General Motors are seeing a silver lining in incentive programs that both companies launched to move 2008 inventory. General Motors is extending its "Employee Discount for Everyone" effort, and Chrysler will extend its "Shop 'Til You Drive" push.

Steve Landry, Chrysler's EVP of North American sales, said the Auburn Hills, Mich. company sold 110,235 units, a 34% drop year-over-year. But he says some of the drop-off is consequent to Chrysler's decision to end leasing. He says the company leased 24,000 vehicles in August 2007, versus 2,000 in August '08. But he adds that some of those lost leases became sales. "We think we recovered 30% of the lease business. That's a big difference for us."

Landry says that as the company prepares to launch the 2009 Dodge Ram pickup, it will back the extended "Shop 'Til you Drive" effort with print and TV advertising to clear lots of 2008 model Rams, among other cars and trucks. He says the deal has offered up to 40% off Ram and 24% off other vehicles on top of bonus cash. "We are making a point to communicate directly with lease customers," he says. "We have some 165,000 leases reaching maturity in the fourth quarter, so we are offering them an easy ramp onto retail deals after leases end.

"The most important thing is to have a clean foundation for when the industry comes back. We are working very, very hard to get every bit of the fair share of the million people coming in to buy new vehicles every month."

General Motors, which posted sales of 308,817 vehicles in August--a 20% decline versus August of last year, but 31% better than July--will extend the employee-discount campaign through September, per Mark LaNeve, VP/GM North America sales, service and marketing. He said in a release that the company is adding nineteen 2009 models to the list of vehicles eligible for the employee-discount deal "because our 2008 stock on dealer lots is rapidly disappearing."

The company was even able to move 80,000 pickups last month, with Chevrolet Silverado, Avalanche and GMC Sierra pickups enjoying their strongest total sales month since last August. The company says Silverado sales were up 69%, Avalanche was up 59%, and GMC Sierra sales saw a 75% boost versus July 2008.

LaNeve said a moderation in fuel prices has helped. "We're seeing some relaxation of pent-up demand in pickups and utilities. Our August sales of these segment-leading trucks and utilities has been the best in nearly a year, and August marked the fourth consecutive month that truck sales as a percentage of GM and industry sales increased. We also saw double-digit retail increases in our crossovers compared with July."

The company posted Chevrolet, Pontiac and Cadillac retail car sales that were up 18%, 11% and 10% versus last August, respectively.

Ford posted overall sales declines of 15.5%. The Ford brand saw a 14.7% dip, Lincoln had a 18.8% drop, and Mercury had a 23.6% decline. Ford's Volvo division saw sales drop 22.8%.

Toyota Motor Sales said August sales were 211,533 vehicles, a 9.4% decline from last August. Toyota divisional sales were off 9.4%, Lexus was off 9.1%, with Toyota division light trucks off 17.6% from August last year.