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U.S. automakers see lowest market share ever!

As painful at it may be to accept, July auto sales numbers are in, and for the first time ever, U.S. automakers captured less than 50% of market share last month. This afternoon July sales figures were posted, and in a harsh reality of the hard time American automakers are going through, the figures point to America's Big Three manufacturers accounting for only 49.7 percent of sales last month.

The "Big Three" American manufacturers are DaimlerChrysler (NYSE: DCX), Ford Motor Co. (NYSE: F), and General Motors (NYSE: GM). While today's numbers really shouldn't surprise too many people, it should serve as a nice wake-up call to all the above companies which have been struggling to keep up with their foreign rivals.

General Motors posted strong earnings yesterday, but as we pointed out, the one big area of weakness remains its sales in North America, where it once again posted another loss last quarter.

The only bright side is that American manufacturers were not the only companies that suffered from poor sales last month. Even the red hot Toyota Motor Corp. (NYSE: TM) saw a year-over-year decline of 7.4%.


But the question remains... what can Ford and GM do to regain American market share? Most analysts and industry experts agree that both companies rely far too heavily on truck sales and need to start to diversify more out of this area. This segment of the auto market has been particularly hard-hit recently due to the weak housing market that has led to slower housing starts. As housing starts fall, so will the demand for heavy trucks and consequently F and GM auto sales.

Ford and GM currently have about 30 percent of their product line represented by trucks. Compare that to Toyota's low 5% and it doesn't take a genius to understand one major reason why Detroit is falling behind.

What do you think about these recent figures? I am curious to hear from our readers why they think Ford and GM are unable to take back lost market share. If you were in the market for a new vehicle today would you even consider visiting your local Ford of GM dealer? Or would you head straight to the Toyota or Honda lot, and why?

Michael Fowlkes has worked as a stock trader for seven years and spent the last two years working as an analyst for the online investment advisory service Investor's Observer.
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Last updated: November 27, 2009: 06:16 AM

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