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Toyota's woes jumble market

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Toyota's woes jumble market

Ford, GM, Chrysler all post gains in Feb. sales

BY BRENT SNAVELY

FREE PRESS BUSINESS WRITER

Toyota's recall troubles are leading to a historic shakeout in the U.S. auto market that has Ford rising to the top, and is allowing General Motors and Chrysler to make some gains following their bankruptcies.

Sales of Toyota cars and trucks, following the automaker's recall woes, fell 8.7% in February and are now down 12.4% for the year.

That led the Japanese automaker to announce new incentives on Tuesday.

The decline has had other automakers scrambling to snap up their customers, and some -- such as Ford, Nissan, Honda and Hyundai -- are doing better than others.

The shakeout was most evident in the midsize car segment.

Sales of the Camry, which was the No. 1-selling car in the U.S. in 2009, fell 19.8%. The longtime best-selling car fell to fifth place in February.

Sales of the Honda Accord jumped 25.3%, landing the car in the No. 1 spot.

And sales of the Ford Fusion surged 116.5%, putting the Fusion in third place and in spitting distance of the Camry's No. 2 spot for the year.

More signs of rebound

Overall, U.S. consumers purchased 13% more new cars and trucks in February.

While that suggests the economy is on the mend, the increase was less than expected as snowstorms and Toyota's recall troubles slowed down the industry's recovery.

"We really believe the gradual economic recovery in the U.S. remains on track," said Mike DiGiovanni, GM's executive director of market analysis.

The seasonally adjusted annual rate, or SAAR, for February was 10.38 million vehicles. That's down from 10.78 million in January and is the lowest industry selling rate since September.

The SAAR indicates what sales would total for the whole year if demand remained constant over 12 months, adjusting for seasonal factors. It's an easy reference to compare how the market is performing month to month.

"There was a lot going on this month, including some pretty bad weather," said Ford sales analyst George Pipas. "It is difficult to get a clear reading on what the real industry sales rate is."

DiGiovanni said sales probably would have been 5% higher without snowstorms that dumped more than 40 inches of snow in some Northeastern cities.

Toyota a touchy subject

GM and Ford were reluctant to talk much about the sales they gained from Toyota as the Japanese automaker struggled to contain the damage caused by its recall of more than 8 million vehicles.

"We got our fair share of Toyota sales," DiGiovanni said.

Sales increased 12.2% for GM but they increased even more, 32%, for GM's four core U.S. brands, Chevrolet, Cadillac, Buick and GMC.

Much of the increase was because of demand for new crossovers such as the Chevrolet Equinox, which jumped 133%, and the Cadillac SRX, which saw sales more than quadruple.

But Ford was the big winner for the month with a 43.4% sales gain that was more than three times as strong as the industry's increase.

When asked about how much it benefited from Toyota's troubles, Ken Czubay, Ford's vice president of U.S. marketing sales, would only say vehicles such as the Ford Fusion and Mercury Milan, which are cross-shopped by Toyota customers, were among Ford's top performers.

Ford is 'pumped'

Ford also outsold GM for the first time since 1998.

In all, Ford outsold GM by 429 cars and trucks.

Ford beat GM's monthly sales tally in 1998 and in 1970; both times, GM was battling a UAW strike.

"Ford is pumped," said Jim Seavitt, owner of Village Ford in Dearborn, who was at the Geneva Motor Show mingling with top Ford executives. "The mood is great."

While Ford's sales were boosted by a 74% surge in sales to commercial fleet customers, the automaker still posted an impressive 28% retail sales gain.

"Ford invested heavily in the product lineup several years ago and it is now paying off," said Jesse Toprak, vice president of industry trends for TrueCar.com.

Chrysler posts a gain

In February, Chrysler reported its first monthly sales increase since December 2007.

Chrysler sold 0.5% more vehicles in February than a year ago.

Sales of four car models surged more than 50%, including Chrysler Sebring, up 118%; Dodge Avenger, up 78%; Chrysler 300, up 62%, and Dodge Charger, up 55%.

link:

http://www.freep.com/apps/pbcs.dll/article?AID=/20100303/BUSINESS01/3030352/1210/business01/Toyotas-woes-jumble-market&template=fullarticle

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