New Car Sales Down 34% in May

Car manufacturers reported sales for May and the numbers were dismal as usual. Sales in May totalled 925,000 vehicles, a 34% drop compared to the same time last year. The good news? Sales were up 13% compared to last month and some manufacturers reported their best sales month for the year.

Ford, GM, and BMW did better than expected while others such as Toyota and Honda continued their poor performance.

Some industry analysts are starting to call a bottom in sales. We're not so sure. The stock market has seen a huge gain of 40% in the last couple of months. Historically, there's a strong correlation between the stock market and car sales.

This may have helped drive sales in the last couple of months, but many feel the stock market is due for another big correction. How that will affect car sales is unknown, but it certainly won't help. Furthermore, unemployment is still climbing and will be over 10% by the end of the year. Whether or not car sales have hit a bottom, the recovery is sure to be slow.

Here's how each manufacturer did in May 2009 compared to the same time last year:

With car sales still in the dumps, dealers are desperate for more customers. It's a buyer's market right now.