Auto inventories at record levels

[United Press International]

DETROIT, May 7 (UPI) -- Analysts say rising U.S. auto
inventories show that the recovering economy isn't helping sales as
the Big Three carmakers expected, the Financial Times reports.
Detroit carmakers cut back on incentives like zero percent
loans and cash rebates in April, anticipating that a strengthening
economy would boost car sales.
One analyst noted that Ford's inventories were 29 percent
above average for April, General Motors' were 22 percent higher than
normal and Chrysler's were 26 percent higher than normal. Toyota,
BMW, and Volkswagen showed similar inventory gluts.
Analysts said more incentive spending would likely help move
the excess inventory, especially since GM and Ford are not planning
to reduce second-quarter production at this point.
But GM and Ford representatives can't explain why sales fell
even with incentives averaging nearly $4,000 per vehicle.
Automakers added that they don't think rising fuel prices
are quashing sales.