Don't look now but the auto industry may have touched bottom.
It's dark and deep. Unsustainably deep. The sharp plunge in auto sales hit domestic automakers particularly hard, according to their announcements Tuesday. Ford's sales plunged 40 percent in January compared with January 2008; GM's fell 49 percent and Chrysler's sunk a whopping 55 percent.
Fewest sales since the last big recession?
The decline could mean that January auto sales fell below 10 million vehicles -- the lowest number since August 1982.
The only bright spot is that the numbers look worse than they actually are. Fleet sales to rental companies were abysmal, but they were caused by plant closings and other factors. The more typical retail sales looked basically unchanged from a month earlier.
Ford, for example, has seen three months of roughly equal retail sales.
"What we're looking for at this point is stabilization," said Emily Kolinsk Morris, senior US economist for Ford, in a conference call with analysts. There are "faint signals" that US car sales may be bottoming out, she added.
Bottom isn't official, yet
"It's a little early to call an official bottom," said Jesse Toprak, Edmunds.com's executive director of industry analysis, in a conference call with reporters. "If February [sales] are around the same rate, it will be safer to call November a bottom."
Even if sales have stabilized, they are nowhere near the level they need to be for auto companies to survive.
"If the [seasonally adjusted annual sales] rates of 10 million lingers for a long time, this is not a sustainable level -- not just for domestics but for any automaker," Mr. Toprak said.
Japanese see smaller declines
Japanese automakers' US sales also fell dramatically from a year ago, led by Toyota (down 32 percent). Nissan's sales fell 30 percent and Honda's, 28 percent. Only Subaru, up 8 percent, and Hyundai, up 14 percent, bucked the trend among the major automakers.
Hyundai's marketing coincided perfectly with the mood of the times. If customers lost their job within 12 months of buying a Hyundai, they'd get their money back.
"The core of the problem right now is consumer confidence," Toprak said.