GM post surprise sales gain

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GM posts surprise sales gain

U.S. automaker bucks industry trend to post gain in U.S. sales in August; Ford sales plunge could drop it out of long-held No. 2 spot

By Chris Isidore, CNNMoney.com senior writer

September 4 2007: 2:10 PM EDT

NEW YORK (CNNMoney.com) -- General Motors posted a surprise sales gain in August, bucking an industry trend of weak auto sales in the period, and helping domestic brands to recapture a majority of U.S. sales.

GM said its sales of cars and light trucks, such as SUVs and pickups, rose 6 percent in the month to 385,529 vehicles. Car models saw a nearly 8 percent drop in sales, but that was outweighed by the the 16.5 percent jump in light truck models.

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The GM sales results came as rival Ford (Charts, Fortune 500) reported Tuesday that its total U.S. sales fell about 14 percent to 218,332 in the month. That was a bit better than one forecast, but it dropped Ford out of its traditional place as the No. 2 U.S. automaker.

Toyota Motor (Charts) posted a rare drop in U.S. sales to 233,471, which was weaker than forecasts. But its sales were still enough to put it ahead of Ford Motor in the month. It also saw its year-to-date sales top Ford's light vehicle total, which excludes sales of heavy-duty trucks.

Toyota had been expected to overtake Ford at some point this year since Ford trimmed its capacity and closed plants in an effort to stem losses.

U.S. rival Chrysler Group is also forecast to see sales decline, while other Asian automakers such as Honda Motor (Charts) and Nissan (Charts) are forecast to post sales gains. Those other automakers are due to report August results later Tuesday.

The good results at GM and the weaker-than-expected sales at Toyota could give the traditional domestic brands slightly more than 50 percent of total U.S. sales in August, even if it's down from the 53.2 percent combined market share they had in the year-earlier period, according to another sales tracker, Autodata.

In July the domestic brands captured only 48.1 percent of sales, marking the first time that import brands captured more than half of U.S. sales in a month.

Part of the drop in sales at Ford was due to it backing away from some of its traditional sales to corporate fleet customers, particularly to rental car companies. Those sales are less profitable because they are at a lower price than retail sales. Ford said its sales to rental car companies dropped 44 percent from year-ago levels.

But sales to retail customers by Ford still dropped 13 percent, an indication that the weakness in demand for its products is not limited to a deliberate strategy of cutting back sales to the rental car market. The F-series pickup, still the nation's best selling vehicle, saw its sales off nearly 10 percent, as the favorite of builders and contractors was hit by the slump in housing and new home construction during the period.

In an increasingly global auto industry, the distinction between domestic and import brands is somewhat less useful than it once was.

Auto parts and components can be sourced around the globe and among those automakers counted as import brands are those currently owned by Ford, such as Volvo, Land Rover and Jaguar, as well as Saab, a unit of GM.

The major Asian automakers also make a significant percentage of their vehicles for the U.S. market at North American plants.

But Ford is exploring a sale of its luxury European brands, and during the month German automaker DaimlerChrysler (Charts) completed a sale of a majority stake in Chrysler to U.S. private equity firm Cerberus Capital Management, separating the sales of the Chrysler, Dodge and Jeep brands from those of European luxury brands Mercedes Benz and Maybach.

So in some ways the distinction between the traditional Big Three and their import rivals is now more relevant than it was only a few months ago, when those U.S. automakers had closer ties to import brands.


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Why did this article stray to an import vs. domestic argument again???

Just giving Toyota and Co. a leg up by saying "Hey, they're not exactly imports" which is :bs: anyway.


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