Sign in to follow this  
NINETY EIGHT REGENCY

Auto sales hit highest levels in nearly a year

2 posts in this topic

Auto sales hit highest levels in nearly a year

GM leads sales gains of Detroit carmakers; recovery remains weak

Christine Tierney and Scott Burgess / The Detroit News

Auto sales rose modestly last month but reached their best levels in nearly a year as many consumers returned to dealer showrooms.

A large portion of sales came from customers replacing very old vehicles, auto executives and economists said. They noted that consumer confidence remains fragile because customers are concerned about the slow pace of the recovery, as other economic indicators have shown.

"We know this is the slowest recovery we've seen in our adult lives," Mark Fields, Ford Motor Co.'s president of the Americas, told reporters in Traverse City.

In this difficult atmosphere, General Motors Co. performed strongly with fewer brands than it had a year ago, leading the sales gains recorded by all three Detroit automakers in July.

Toyota Motor Corp. and Honda Motor Co. reported lower sales after having benefitted strongly from the cash-for-clunkers program introduced in July 2009.

Nissan Motor Co. and the Hyundai-Kia Automotive Group reported the biggest July sales gains among the major players.

Total car and light truck sales rose 5.2 percent from last July and were up 6.7 percent from June, according to Autodata Corp.

On an annualized basis, the selling rate reached 11.99 million vehicles, the highest level since last August, when cash-for-clunkers deals were available during the entire month to boost a market that had collapsed.

Demand for vehicles appeared to be flagging again in recent months, but July's sales are likely to fall in the category of indicators confirming that a recovery is under way.

"The recent data haven't changed our view of the ongoing economic recovery," said Emily Kolinski Morris, senior economist at Ford. The company expects full-year sales to range between 11.5 million and 12 million vehicles, compared with 10.4 million in 2009.

"It's going in the right direction," TrueCar.com analyst Jesse Toprak said about the economy, "But it's going in the right direction very cautiously. Consumer confidence is still far from repaired, and credit availability is far from what it should be for a full-blown recovery."

GM reported a 6.4 percent rise in monthly sales, the largest among the domestic automakers.

Sales rose in all four of its remaining brands -- Buick, Cadillac, Chevrolet and GMC, with Cadillac sales more than double year-earlier levels. Kurt McNeil, sales and service vice president for Cadillac, attributed the sales increases to pent-up consumer demand and more banks making loans available to customers.

"We're seeing more credit availability," McNeil said.

Cadillac continues to show success with the redesigned SRX. Sales for this crossover rocketed to 5,723 from 648.

The Buick LaCrosse remains hot with consumers; Buick sold almost as many LaCrosses in July -- 7,047 units -- as it sold vehicles last July -- 7,099 units. GM also noted an increase in pickup sales and expects to see that trend continue for the rest of the year, helped by the rollout of the new heavy-duty Chevrolet Silverado and GMC Sierra.

"People who've put off replacing vehicles are now slowly coming back into the market," said Don Johnson, GM's vice president of U.S. sales operations.

Lower incentives

GM isn't luring them back with incentives. Its discounts average $3,270 per vehicle, down $730 from a year ago. "We're selling more vehicles at higher prices and lower incentives," Johnson said.

GM remains cautious about the economy. Johnson noted that the rate of job growth was the slowest of any recovery since World War II.

Even so, "we see a low risk of a double-dip" recession, he said.

Ford reported a 3.3 percent increase in sales for July compared with the same month last year. Stripping out slumping sales of Volvo Cars, sold Monday to China's Zhejiang Geely Holding Group, Ford's sales were 4.8 percent higher. But without Volvo, it falls to third place in the U.S. market with a 15.8 percent market share, behind Toyota's 16.1 percent share in July.

Ford's sales rise was led by stronger pickup sales, which tend to be an economic indicator in themselves because so many are purchased by small businesses.

Ford's pickup sales were up 39 percent from last year. The company sold more than 50,000 pickups in July -- the first month the automaker has sold more than 50,000 pickups since March 2008.

Ford's new SuperDuty heavy-duty truck led the resurgence in pickup sales, with sales up 63 percent compared with last July.

Mercury sales, however, fell 31 percent compared with last July. The Dearborn automaker is retiring the Mercury brand.

"Our sell-down is proceeding smoothly," said Ford market analyst George Pipas. "By the end of the year, there'll be only a few Mercurys in stock."

Premium Lincoln sales were down 16.3 percent for the month, and Volvo sales were down 32.9 percent for the month.

Most other European brands fared well in July, bolstered by a strong recovery in demand for luxury cars. European brands rose 10.2 percent in July, with Volkswagen, BMW, Audi, Jaguar, Land Rover, Mercedes-Benz and Porsche posting solid gains.

Chrysler Group LLC reported a 5 percent increase in sales for July compared with the same month last year. Sales for the year at Chrysler are up 10.8 percent.

"We're gaining some real traction with the all-new Jeep Grand Cherokee, and we look forward to the same when we revamp the remaining 75 percent of our nameplates by year end," said Fred Diaz, president and CEO of the Ram Truck brand and lead executive for U.S. sales.

Toyota sales drop

Toyota reported a 3.2 percent drop in July sales, compared with the same month last year. "Last July was a particularly good month for us," Bob Carter, general manager of the Toyota brand division, said on a conference call.

He said the negative effects of Toyota's big recalls and quality issues seemed to be subsiding in the marketplace.

The proportion of trade-ins of non-Toyota brands has risen back above 50 percent, where it was a year ago. "While we have a ways to go, we view that as a positive sign," Carter said.

Honda's sales fell 2 percent from last July, when the cash-for-clunkers program buoyed demand for the automaker's economical, fuel-efficient vehicles.

"Although July sales declined versus last year, our sales increased compared to June 2010, which is a positive sign," said John Mendel, executive vice president of sales at American Honda.

The top performer among the Japanese automakers, Nissan reported a 14.6 percent increase in July sales, helped by strong demand for the Nissan Rogue, a small crossover.

"In fact, all of Nissan's crossovers, trucks and SUVs showed substantial gains over last July," said Al Castignetti, general manager of the Nissan division.

Hyundai Motor Co.'s sales rose 18.8 percent, even though it had a tough comparison with last June's sales levels. Hyundai offered cash-for-clunkers deals even before the rules were spelled out toward the end of July of 2009. U.S. sales of its Kia Motors affiliate were up 20.7 percent last month.

From The Detroit News: http://www.detnews.com/article/20100804/AUTO01/8040325/1148/auto01/Auto-sales-hit-highest-levels-in-nearly-a-year#ixzz0vdrsCZOk

Share this post


Link to post
Share on other sites

New models, trucks spur auto sales

Detroit 3 gain slightly; Toyota, Honda dip

BY GREG GARDNER

FREE PRESS BUSINESS WRITER

Strong sales of new models, pickup trucks and brisk demand from commercial fleets helped Detroit's three automakers post slightly better sales in July.

In contrast, sales for Toyota and Honda fell 3.2% and 2%, respectively. A year earlier, they benefitted more than the Detroit Three from the government's cash-for-clunkers rebate program, which began in the last week of July 2009.

"Toyota and Honda are also being affected by the big incentives they offered earlier this year, which pulled ahead sales considerably," said analyst Aaron Bragman of IHS Automotive in Northville.

Overall industry sales rose 5.2%, weaker than forecasters expected.

"We know this is the slowest recovery we've seen in our adult lives, but it is a recovery," said Mark Fields, Ford's president of the Americas.

The annual selling rate for July was 11.98 million vehicles, nearly 1 million above June's rate, according to Autodata.

General Motors' sales rose 5.4% from a year earlier, while Ford's edged up 3.1% and Chrysler's improved 5%. Excluding four brands GM discontinued or sold -- Pontiac, Saturn, Hummer and Saab -- its July sales climbed 25%.

New models that sold extremely well included Buick LaCrosse, up 380%; Cadillac SRX, up 783%, and the new Buick Regal, with 1,703 sold in its first full month on the market.

Ford's Taurus nearly tripled sales of the old model it replaced. The Transit Connect commercial van continues to sell well, and the new Fiesta posted sales of 3,349 in its first full month in most showrooms.

Chrysler's gain was driven by a 19% increase for the Jeep brand and surprisingly strong demand for Dodge Charger and Challenger muscle cars. Challenger sales more than quadrupled from a year earlier to 3,695 in July.

Cadillac, which struggled last summer because it could not offer many leases, will take heart that its sales more than doubled to 14,919 in the same month Toyota's Lexus luxury brand sales were flat from a year earlier.

Another trend was an industry-wide surge in pickup sales. Chevrolet Silverado jumped 25.5%. Ford F-Series sales, including the 2011 Super Duty, rose 39%. Dodge Ram increased 14% and Toyota Tundra sales were up 40% from a year earlier.

Pickup sales tend to improve when construction, farming or other commercial activity increases.

"We are starting to see the construction and work truck buyer return," said Bob Carter, Toyota division general manager, who said the Tundra sold particularly well in Texas and other gulf coast states.

About one of every four GM and Ford vehicles sold were purchased for rental companies, corporate or government fleets. Such fleet sales account for less than 10% of Toyota's sales, Carter said.

But Detroit automakers have done better at keeping production in line with what dealers can sell.

Don Johnson, vice president of GM's U.S. sales operations, said the average selling price per vehicle has increased about $3,300 through the first seven months of 2010 versus a year earlier.

GM's incentive costs were 10.4% of the average selling price in July, about equal to the industry average, and down from 14.6% in the first seven months of 2009, Johnson said.

August sales likely will fall from last August's levels when cash-for-clunkers stimulated sales to an annual rate of 14.1 million vehicles.

"We're still talking about depressed rates of sales, but it's clear there's a gradual up trend that is likely to continue," said Dana Johnson, chief economist at Comerica Bank in Dallas.

Brent Snavely contributed.

link:

http://www.freep.com/apps/pbcs.dll/article?AID=/20100804/BUSINESS01/8040370/1331/New-models-trucks-spur-auto-sales&template=fullarticle

Share this post


Link to post
Share on other sites

Your content will need to be approved by a moderator

Guest
You are commenting as a guest. If you have an account, please sign in.
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoticons maximum are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this