CNW Study Says GM and Chrysler Sales Hurt By Uncertainty

DETROIT, March 19, 2009; Reuters reportede that fewer new car shoppers are considering vehicles from General Motors Corp and Chrysler at a time when consumer attention is focused on their request for further U.S. government aid, according to a survey released on Thursday.

The share of car shoppers who say their primary choice would be a vehicle from one of the GM brands dropped by almost 12 percent, while the share for Chrysler dropped by a third, according to the survey released by CNW Research.

"There is nothing to stop the slide in intentions for those on the downside of this survey," CNW said in a monthly research note on the auto market.

"But the decisions to cut back on advertising haven't helped GM or Chrysler. Nor has the talk of bankruptcy, which continues to haunt those brands."

Ford Motor Co, the only one of the U.S. automakers that has not accepted emergency aid from the U.S. government, has seen a nearly 12 percent increase in the share of car shoppers who say it would be their first choice.

The CNW survey was based on responses from more than 40,000 consumers who say they intend to buy a new vehicle and conducted in January and February, according to the research firm.

Honda Motor Co Ltd showed a 13-percent jump in its ranking as a primary choice among those who intend to buy a vehicle.

The biggest gains in the CNW survey came for South Korea's Hyundai Motor Co (005380.KS) and its affiliate Kia, both brands that have gained share in a slumping U.S. market so far this year.

The share of car shoppers who say Hyundai would be their primary choice jumped 59 percent. Kia rose by almost 50 percent in the CNW survey.

On a combined basis, the two Korean brands had a U.S. market share of just over 5 percent in 2008.

"Hyundai and Kia show staggering increases in future consideration," CNW said. "While that may be considered a distortion because they are starting with a low base market share, it is worthy of consideration considering how well both brands have been doing during the past rough months."

Earlier this year, Hyundai rolled out a novel incentive program that allows car buyers to return their vehicles if they lose their jobs.

GM has said it is studying the Hyundai offer and may offer a similar program of its own.

AutoNation Inc, the leading U.S. auto dealership, said this week it would begin offering car buyers a guarantee program that will cover up to six months of payments for consumers who lose their jobs.

Editing for Reuters by Andre Grenon