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Ford and GM see big fall in sales US car firms report sales slump
(10 minutes later)
Ford and General Motors (GM) both saw a a sharp fall in US sales in January, as the woes facing the country's carmakers show no signs of improving. Ford, General Motors (GM) and Chrysler have all reported a sharp fall in US sales in January, as their woes show little sign of improving.
Sales at Ford plunged 42% last month from a year earlier, while those at GM declined even further, slumping 49%. Sales at Ford plunged 42% last month, compared with a year earlier, while those at GM declined 49%, and Chrysler was hit by a fall of 55%.
Ford's bleak sales update comes just a week after it reported a record $14.6bn (£10bn) annual loss for 2008.
GM and Chrysler, the third big US car firm, needed a multi-billion dollar government rescue deal last month.GM and Chrysler, the third big US car firm, needed a multi-billion dollar government rescue deal last month.
Chrysler is also due to report a big fall in January sales. While Ford last week reported a record $14.6bn (£10bn) annual loss for 2008.
Government supportGovernment support
American car sales have slumped as consumers have cut back on making large purchases as US recession has deepened. American car sales have slumped as consumers have cut back on making large purchases as the US recession has deepened.
US consumers have cut back on buying new carsUS consumers have cut back on buying new cars
The decline has also hit sales of foreign cars in the US. Toyota's January US sales were down 32% from a year earlier, while those at Nissan dropped 30%.The decline has also hit sales of foreign cars in the US. Toyota's January US sales were down 32% from a year earlier, while those at Nissan dropped 30%.
However, both Subaru and Hyundai bucked the trend, with their January US sales rising 8% and 14%.However, both Subaru and Hyundai bucked the trend, with their January US sales rising 8% and 14%.
General Motors (GM) and Chrysler were last month given a $17.4bn bail-out from the White House, after they warned that they were running out of cash. GM and Chrysler were last month given a $17.4bn bail-out from the White House, after they warned that they were running out of cash.
The financial situation at Ford is not as bad, although it has secured a $9bn government credit line that it will be able to access in the future if needed.The financial situation at Ford is not as bad, although it has secured a $9bn government credit line that it will be able to access in the future if needed.
GM said on Tuesday that it would offer voluntary redundancy to 22,000 US employees as it seeks to cut costs.GM said on Tuesday that it would offer voluntary redundancy to 22,000 US employees as it seeks to cut costs.
Industry-wide US car sales fell 185 in 2008 to 13.2 million vehicles.Industry-wide US car sales fell 185 in 2008 to 13.2 million vehicles.
Sales for 2009 are expected to drop near 10.5 million, analysts say.Sales for 2009 are expected to drop near 10.5 million, analysts say.
Chrysler argues that more customers would like to buy new cars, only they can't secure the loans to do so, because of the continuing problems in the US banking sector.