- November 3, 2010
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Major Automakers Post Solid Sales Gains as Rebound Continues
Today’s results from GM, Ford, Chrysler and Honda, combined with a strong showing among some smaller automakers reporting yesterday, reinforced forecasts that October would reflect the industry’s gradual rebound from last year’s collapse. One exception was Toyota Motor Corp., where sales fell 4 percent.
“GM exceeded our expectations,” said Rebecca Lindland, an analyst at researcher IHS Automotive. “Consumers who have a job are feeling a little bit better and not fearing every Friday anymore. They feel like the worst is over and they’re starting to trickle back into showrooms.”
At the Ford division, car demand rose 23 percent, fueled by sales of the Fusion and Focus. Sales of the F-Series pickup jumped 24 percent last month, helping overall Ford Division light truck demand advance 20 percent. At Lincoln, sales rose 2 percent.
Chrysler’s October sales rose 37 percent, its 7th consecutive month-over-month increase. Its sales are up 17 percent year-to-date.
At American Honda, sales jumped 16 percent. The availability of the new 2011 Odyssey, in its first full month on the market, helped push Honda Division light-truck sales up 37.8 percent to 41,463, the automaker said.
GM’s comparisons to last year continued to be dragged down by its discontinued brands. The company sold 15,089 Saab, Saturn, Hummer and Pontiac models in October 2009; last month, just 367 units of those brands were sold.
GM said sales of current and discontinued brands rose to 183,543 units. The 4 percent gain was better than the 3 percent decline that TrueCar.com analysts expected.
New crossover models such as the Chevrolet Equinox, GMC Terrain and Cadillac SRX, along with pickup trucks, are driving GM’s results.
At Chevrolet, GM’s biggest division, sales jumped 7 percent, with truck demand up 10 percent and car sales up 3 percent. GMC, GM’s second-biggest division, said sales rose 32 percent last month, while Buick sales jumped 39 percent.
GM’s year-to-date sales are up 6 percent.
The automaker told analysts today it is transitioning to new model year (2011) vehicles more rapidly than the industry, and expects to gain retail market share in October, compared to September.
“Of our October sales, 76 percent were new (2011) model year vehicles,” Don Johnson, head of GM’s U.S. sales operations, said in a statement. “This puts us in good position to continue growing, while moderating our use of incentives.”
Tracking the SAAR
On a seasonally adjusted annual selling rate basis, analysts expect October industry volume to be the strongest since August 2009.
The average of nine analysts’ estimates compiled by Bloomberg is a SAAR of 11.9 million. That’s just above September’s 11.8 million pace, according to Autodata Corp. figures.
Excluding the August 2009 spike caused by the federal government’s $3 billion cash-for-clunkers incentive program, 11.9 million also would be the strongest month since September of 2008.
Because of the U.S. elections held yesterday, October auto sales are being released over two days. Ten automakers, including Hyundai-Kia, Subaru and BMW, reported Tuesday that their combined October sales rose 28 percent in October, according to the Automotive News Data Center.
Daimler AG said October sales of Mercedes-Benz, Smart and Maybach brands rose a combined 3 percent.
Some automakers reporting Tuesday had higher percentage gains.
Hyundai-Kia Automotive boosted monthly sales 38 percent, lifting the South Korean automaker sales to a 10-month advance of 19 percent. Hyundai and Kia say they will each set U.S. sales records this year.
Volkswagen of America gained 16 percent.
Subaru of America was up 25 percent. For the first 10 months, Subaru has sold 216,334 units, up 23 percent from the same period last year and only 318 vehicles short of its record annual sales set in 2009.
“Subaru’s consistent success over the past three years is not only a testament to their product lineup and customer loyalty, but also an indicator of how well positioned they are as the industry starts to recover,” Edmunds.com senior analyst Karl Brauer said.
Mitsubishi’s sales jumped 32 percent for the month to 5,111 units, helping to pull the automaker’s year-to-date results nearly even with year-earlier levels.
BMW Group sold 23,248 BMWs, Minis and Rolls-Royces in October, up 13 percent.
Porsche’s October sales jumped 61 percent, bringing this year’s totals to a 28 percent gain from a year ago.
Jaguar Land Rover boosted sales by 40 percent.
Even struggling Suzuki advanced. After its 17 percent October gain, Suzuki’s U.S. sales are down 45 percent in the first 10 months of the year.
Through September, industry sales had been running about 30 percent slower than the 16.8 million annual average from 2000 through 2007.
“The business is moving from 2010s being sold at big discounts to 2011s sold at a premium,” said Jeremy Anwyl, CEO of Edmunds.com.
“The 2011s are doing OK, so there is some indication that consumers are willing to pay more for the newer models. They’re hesitant but feeling a bit better.”
The U.S. economy expanded at a 2 percent annual rate in the third quarter, the Commerce Department reported Oct. 29. Confidence among consumers fell last month to the lowest level in almost a year, according to the Thomson Reuters/University of Michigan final index of consumer sentiment. The U.S. jobless rate is projected to stay above 9 percent through next year.
Industry spending on incentives declined slightly from September, according to estimates from Edmunds.com. It put the industry per-vehicle average at $2,498 last months, down $61 from the month before and $172 lower than in October 2009.
Toyota, the world’s largest automaker, had smaller discounts on 2010 model year vehicles compared with its competitors, said Ivan Drury, an Edmunds.com analyst.