Auto Sales At Big 3 Fall Further

DETROIT, Jan. 3 — The Detroit auto show, which opens next week, is all about new concepts, building buzz and making fresh starts. And the Detroit auto companies can use all of that.

In a stern reminder of how hard it has become to sell cars, General Motors, the Ford Motor and the Chrysler Group ended 2006 with two lows, the companies said Wednesday. Their dismal December performance led to their lowest collective market share ever, just 51.5 percent for the month.

And for the year, they held only 53.7 percent of the market, also a low. The reason for the poor showing rests mostly with a lineup laden with sport utility vehicles and pickup trucks that proved out of fashion with Americans demand for fuel-sipping automobiles.

Basically, that caught Detroit by surprise, said Ron Pinelli, president of Autodata, which tracks industry statistics.

So did the strength of Toyota Motor of Japan, which set a sales record in 2006 to pass DaimlerChrysler and take third place in the American car market. Now it is bearing down on Ford, which it is expected to unseat this year to take second place, behind G.M.

Wednesdays sales report proves that despite the gleaming new models that are set to go on display at the Cobo Center in Detroit this weekend, the competition on the streets will be just as fierce next year, even though gasoline prices are easing.

At best, analysts and auto executives expect industry sales to be flat with the 16.5 million sold in 2006, down from 16.9 million sold in 2005, according to Autodata.

At worst, some forecasters see sales falling as low as 16 million vehicles, which could force the Detroit companies to speed or expand their revamping plans. How do you make profits with less sales? said Jesse Toprak, an industry analyst with Edmunds.com, which offers car-buying advice.

No matter the outcome, one thing seems certain: cars are back, big time.

Toyota, whose sales rose 12.9 percent last year, gained more than two percentage points to end the year with 15.4 percent of American sales. It sold almost 450,000 Camry sedans, the nations best-selling car for the fifth consecutive year, and nearly 400,000 small Corollas.

Were a company that continues to listen to the market, said James Lentz, executive vice president of Toyota Motor Sales U.S.A.

A bonus for Toyota was its Scion brands, three small vehicles aimed at the industrys youngest buyers. That division racked up almost as many sales last year as Ford did for its Mercury division.

Honda Motor, meanwhile, said its sales rose 3.5 percent in 2006 to its 10th consecutive record, mostly because of a strong reception for its small car, the Fit. Together, Toyota and Honda sold almost as many cars and trucks in the United States as G.M., where 2006 sales dropped 8.7 percent.

Even Ford, whose overall sales fell 7.9 percent in 2006, could point to its cars as a glimmer of hope. It scored a modest-selling hit in the last year with the midsize Fusion, and it is showing a four-door version of the Mustang at the Detroit show, hoping to build on its pony cars success.

But Fords efforts on cars cannot camouflage its slumping truck lineup. Sales of its Explorer S.U.V., once the star of its stable of sport utilities, fell 25.3 percent in 2006, while its F-series pickup dropped 11.7 percent. All told, it sold 105,000 fewer of those vehicles than it did in 2005.

Ford will not overhaul the F-series for more than a year, although it plans a new Super Duty model this winter.

By contrast, G.M. has begun selling new models of its pickup, and Toyota will begin selling the biggest version yet of its Tundra next month.

I think the full-size truck market is going to look very much like a sumo wrestling match, said Fords senior sales analyst, George C. Pipas. There is going to be pushing and shoving,

Paul Ballew, G.M.s executive director of global market and industry analysis, said the company expected its sales of pickups to remain flat this year.

I know its been in vogue this year to talk about the sun setting on the truck business; we obviously disagree with that, Mr. Ballew said. We dont see the market shrinking, and we see our performance as more than holding our own.

G.M. did not hold its own in December. Its sales fell 8.7 percent, more than analysts had anticipated given a year-end rebate effort, while its market share for the month was 23.5 percent, compared with an average for the year of 24.3 percent. By contrast, G.M. ended 2005 with 26 percent of the American market.

In the last few months, G.M. executives maintained that the companys market share decline had bottomed out, which helped it fend off pressure from the billionaire investor Kirk Kerkorian, who had been its biggest individual shareholder before unloading much of his 9.9 percent stake.

But lately, some analysts have voiced concern that G.M.s lineup lacks compelling vehicles beyond its pickups, which it expects will sell strongly.

We believe that a more radical and aggressive approach will need to be taken to turn the company around, most specifically in North America, John Murphy, a Merrill Lynch analyst, said in a research note on Wednesday, repeating his sell rating on G.M. stock.

There is also concern in the industry over Chrysler, which offered generous rebates during December to clear out backlogs on dealer lots, especially of leftover 2006 models. Its sales rose 1 percent, though December sales for DaimlerChrysler, including Mercedes, fell 1 percent. For the year, Chrysler sales fell 6.7 percent. Yesterday, the company announced a new wave of incentives of up to $5,000 on some new models.

Mr. Pinelli said the dismal end to a dismal year was a warning to American auto makers that analysts said was long overdue.

Detroit gets it now, he said. They realize that the market-share battle and survival are going to be based on product as well as an image that needs to be revitalized.

Micheline Maynard reported from Detroit and Jeremy W. Peters from New York.

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