With Nissan and Toyota setting a blistering pace, sales in February beat expectations, climbing five percent and pushing the annualized sales rate up to 16.7 million units. That’s a strong rise over January, when the annualized rate was calculated at a disappointing 16.2 million units.
Paul Ballew, General Motors’ general director of market analysis, noted solid sales in February have put the industry as a whole ahead of last year’s actual sales pace by more than 100,000 units.
Representatives from the automakers also said results from February bolstered earlier forecasts that total sales would reach 17 million units this year. “Our sales forecast remains unchanged at 17 million units,” said Jarleth Costello, Ford economist.
“We expect March to be another solid month with around 17 million units (annualized),” Ballew said in a conference call after GM reported its sales had jumped six percent. “We feel positive about the economy and we feel positive about the industry and we feel positive about our position in it….February was in line with our expectations and once again reaffirms that conditions in the economy and the conditions in our industry will continue to improve,” Ballew said.
Ford Motor Co. reported its sales dropped two percent as the company continued plans to curb sales to daily rental fleets, while the Chrysler Group reported a one-percent sales increase — its fifth consecutive monthly increase. Gary Dilts, Chrysler Group senior vice president for sales, said that its sales improved in the last ten days of February, setting the stage for strong sales this spring. “The last couple of weeks ran at an exceptional rate, better than we’ve seen in a long time,” said Dilts. The spring market should be very strong, added Dilts. “We’re going to pour new products into that market,” he added.
Consumers on the rebound?
“Optimistic reports on consumer spending and the economy have definitely helped the industry achieve a solid sales month,” added Jim Press, Toyota Motor Sales executive vice president and COO. “However, rising fuel prices may begin to impact the market if they continue their climb.”
Press’ comments were backed up by strong results from Toyota, which for a change wasn’t the sales leader among the Japanese in terms of increases. Competition across the industry remained fierce as Toyota, Honda, and Nissan continued to post substantial sales gains. And the Toyota Division recorded its best-ever February sales of 126,238, an increase of 15.4 percent. The Lexus Division also reported best-ever February sales of 20,545 units, up 34.1 percent.
But Nissan North America Inc. reported a 46-percent sales increase last month over a year ago, thanks largely to its new full-size trucks. American Honda reported a healthy 7.1-percent increase in sales as well, as Toyota, Nissan, and Honda continued to benefit from combination of strong truck and car sales.
Suzuki, Hyundai, Kia, and BMW also reported sales increases in February, while Audi and Mercedes-Benz reported sales were essentially flat. Mitsubishi, however, said its sales dropped 20 percent and Volkswagen reported a 32-percent drop in sales. Costello said the overall economic conditions bode well for the future. Tax refunds are going out and several indicators suggest the economic recovery is beginning to produce new jobs — perhaps as many as 100,000 per month.
George Pipas, Ford Motor Co. analyst, also said automakers continue to face pressure to use incentives to woo customers. “We went into the year with the view that net prices would decline,” and that hasn’t changed, Pipas said.