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Feb. Sales: Chrysler, Japanese Strong


 

Japanese manufacturers continued to gain ground in February auto sales, despite a relatively strong showing by the Chrysler Group, which saw sales increase in what was basically a flat market.

General Motors and Ford reported another decline for February while Toyota, Honda, and Nissan posted modest sales increases. GM said its sales dropped 2.5 percent, while Ford’s fell four percent. Toyota, the largest Japanese automaker, reported a 2.4-percent sales increase. Nissan boosted its sales by 2.2 percent and Honda’s sales rose by 8.7 percent as they continue to gain market share.

“First-quarter economic growth is proving quite robust,” said Jim Press, Toyota Motor Sales president. “With showrooms awash in new products and the spring selling season upon us, the industry should be going strong in March.”

Even smaller Japanese brands such as Suzuki, Mitsubishi, Mazda, and Subaru watched sales rise in February. Korean automakers, however, reported essentially flat sales while European brands such as Audi, BMW, Mercedes-Benz, and Porsche all posted modest increases.

Ford, meanwhile, was forced to use fleet sales to prop up their February sales totals. GM and Ford also disclosed plans for modest cuts in production during the second quarter. George Pipas, Ford’s sales analyst, said Wednesday fleet sales accounted for more than 40 percent of the company’s sales total for February, surprising analysts monitoring the company’s monthly sales call.

The fleet-sales total was inflated somewhat by an increase in business-related spending, particularly in Florida and the Gulf Coast, which are in the midst of rebuilding from the last year’s hurricanes, Ford officials said.

Pipas also conceded the company had not yet stabilized its retail market share. Sales of Ford’s F-Series pickup, however, increased six percent and sales of Ford, Lincoln and Mercury cars increased two percent, Pipas said.

Gary Dilts, Chrysler Group senior vice president – sales, said Chrysler fleet sales jumped 38 percent last month. February, though, is always a strong month for fleet sales, he noted. However, Dilts said that the three-percent sales increase posted by Chrysler also reflected strength in the retail market.

“Our newest and best products carried the day for us in February,” said Dilts. “The LX platform posted sales of 30,241 units this month, our best ever. Overall, our car business is up 19 percent, and we have the all-new Dodge Caliber arriving at dealerships this month and attracting a new group of customers to our showrooms,” he added.

Dilts dismissed comments by GM officials who said Chrysler had boosted sales by raising its incentives. General Motors is still the industry leader in the use of incentives, said Dilts, who added Chrysler’s total incentives had remained level from January though February. The mix of incentives has been shifting, with some vehicles getting more and some less, he said.

General Motors reported a sales decline of 2.5 percent for February compared to the same month a year ago. Total car sales were down 13 percent, and truck sales were up five percent. However, GM officials were upbeat about the company’s performance because of a strong retail showing.

“Consumer response to our new vehicles and segment-leading value resulted in solid sales results in February,” said Mark LaNeve, General Motors North America vice president, vehicle sales, service and marketing. “Our retail sales improvement in February was driven by our industry-leading value, not by fleet sales or high incentives. This resulted in better retail sales performance by six of our divisions.”

Chevrolet, Cadillac, Pontiac, Buick, HUMMER, and Saab all posted retail sales gains compared to year-ago levels. In addition, sales of GM’s new full-size sport-utility vehicles increased 25 percent compared to last year. Sales of the big SUVs are vital to GM.

“It’s still early, but we’re exceeding all of the important targets for our new full-size SUVs, particularly the Tahoe, which is the first one to arrive in dealerships,” LaNeve said. “The new 2007 GMC Yukon and Cadillac Escalade are just now arriving in dealerships and are off to a very strong start.”

Paul Ballew, GM’s general director of market analysis, dismissed reports that GM was about to launch a major new incentive program. “We’re not announcing a national program,” he said. The company will release some incentive money during March but it will be distributed regionally, he said. GM is a major sponsor of the “March Madness” basketball telecasts, which have come to represent a critical part of the company’s marketing effort every year.

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