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July auto sales may hit record
Report: Expansion of 'employee discounts' sparks strong unit sales for Big 3 through July 15.
July 25, 2005: 7:54 AM EDT

NEW YORK (CNN/Money) - U.S.-based automakers could be headed to one of the their best sales months ever, as buyers flock to take advantage of the "employee discount" offers from the Big Three, according to a published report.

The July monthly sales rate is on track to be somewhere between an annual sales pace of 18 million vehicles and the best ever, Bob Schnorbus, chief economist at J.D. Power & Associates, told the Wall Street Journal.

He said if there is not a new record, the July sales could be the best since the mark set in October 2001, when automakers used zero-interest financing to spur sales in the immediate wake of the Sept. 11 terrorist attack.

The current offer is designed to help the automakers clear out their 2005 models before 2006 models arrive in showrooms.

General Motors Corp. (Research), which was the first to offer employee discount pricing to the general public in June, saw sales soar 47 percent that month compared to a year earlier. Ford Motor Co. (Research) and Chrysler Group, the North American unit of DaimlerChrysler (Research), debuted their own employee pricing offers in July.

According to sales data for the first half of July from J.D. Power's Power Information Network, GM's retail sales were up 42 percent versus the same month a year earlier. Ford's sales gained 27 percent and Chrysler's sales rose 11 percent.

In June, GM's strong sales helped lift industrywide U.S. sales to an annual pace of 17.53 million vehicles, compared with a 15.41 million rate in June 2004 and a 16.67 million pace in May of this year.

Schnorbus believes that the July sales will fall short of the 21.7 million-vehicle pace established in October 2001. Once all the 2005 cars are cleared out, he said he expected sales to drop to the high-16-million range, about the industry's pace this year

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