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GM says its U.S. share may rise for 4th straight month

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GM says its U.S. share may rise for 4th straight month




NOVEMBER 19, 2009 - 11:44 AM ET

UPDATED: 11/19/09 5:17 P.M. ET

DETROIT -- General Motors Co.’s U.S. market share may rise for the fourth straight month in November, the automaker’s chief sales analyst said today.

Mike DiGiovanni, executive director of global market and industry analysis, also predicted the U.S. industry’s seasonally adjusted annual sales rate this month would approach or slightly exceed 11 million units. That would be a boost from October demand.

GM’s share hit 21.1 percent in October, continuing a rise from 18.9 percent in July, when it exited a U.S.-directed bankruptcy. The automaker last month posted its first year-over-year sales gain since January 2008.

"We’re having a solid month," DiGiovanni said.

The national sales rate hit 11.2 million in October for the highest level this year other than August’s cash-for-clunkers-spurred 13.7-million, according to the Automotive News Data Center. Calculations for seasonally adjusted annual sales rates differ by research group, and GM’s October calculation was lower than that of Automotive News.

GM gives total-vehicle sales rates, which are typically 200,000 to 300,000 units higher than light-vehicle demand.

Sales objectives

GM aims to boost sales by managing inventory to match demand, prudently managing sales to rental companies and controlling incentives, said Susan Docherty, vice president of U.S. sales, who spoke on a call with DiGiovanni .

To start, the company has decreased its year-to-date fleet sales by 40 percent from a year earlier, Docherty said.

GM is shooting to maintain a 75-day supply of inventory, Docherty said. The company had a 70-day supply at the start of this month, according to the Automotive News Data Center.

So far this month, 48 percent of GM’s inventory is in 2009 models and 52 percent is 2010 models, Docherty said. That includes about 9,500 Pontiacs and 7,500 Saturns, she said. GM is winding down those brands and may sell about 4,000 Saturns this month and 2,000 Pontiacs, she said.

J.D. Power's forecast

Meanwhile, J.D. Power and Associates said U.S. auto sales in November will likely be slightly higher than year-earlier totals on an adjusted basis because of stable retail demand and rising fleet volume.

U.S. auto sales are expected to grow by 0.4 percent in November when taking into account two fewer selling days this year than last year, J.D. Power said.

The seasonally adjusted annualized rate of sales, a key measure for economists, is expected to rise to 10.2 million vehicles in November from 10.1 million a year ago, it said.

Sequentially, the annualized rate of sales is expected to decline from October, J.D. Power said. The rate in October was the strongest in a year when excluding July and August, which were boosted by the government cash for clunkers incentives.

For the year, J.D. Power expects the U.S. auto industry to post sales of 10.3 million vehicles. It expects industry sales to rise to 11.5 million in 2010.

Reuters contributed to this report

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I was surprised that they dropped 40% of their fleet sales that should increase the bottom line greatly while infusing the demand at the showrooms to see the new models.

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They are heading in the right direction-trying to get to tthe portion of the market that is profitable.


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