Detroit auto deals fail to halt sales drop
By Jeffrey McCracken
Knight Ridder News Service
Auto sales in April dipped from a year ago, as some of the heaviest incentives in the industry's history struggled to erase consumer worries early in the month about the Iraq War, and worries later about increased layoffs and slow wage growth.
April continued the trend of solid truck sales and languishing car sales at Detroit's three automakers. Foreign automakers grew their share of the U.S. vehicle market again last month. Honda Motor Co. and Hyundai Motor Co. reported their best April sales ever.
"I hate to say it, but the numbers aren't great, and the reason is the domestic automakers. There are a lot of value-conscious buyers out there, and they are snapping up things like Hyundai or some of the new products from Honda or a Toyota Corolla," said Michael Wujciak, head of the automotive practice for Cap Gemini Ernst & Young, a consulting firm.
Sales at General Motors Corp. fell 8.5 percent from a year ago, despite the zero-to-60 incentive package that offered no-interest financing for five years on all new cars and trucks except the Hummer. Car sales at GM fell 21.7 percent, while truck sales were up 2 percent.
All sales figures are adjusted to reflect the number of selling days in the month.
It was a similar story at Ford Motor Co., where overall vehicle sales fell 6.6 percent. Truck sales slipped 4.2 percent and car sales were down 10.7 percent. The company had some success with its $5-a-day lease offer for the six-cylinder Mustang; sales jumped 27 percent. The automaker extended the offer for the Mustang and the Ranger pickup until June 16.
Ford announced it will increase vehicle production in the current quarter because of better-than-expected sales of the Expedition and Lincoln Navigator sport-utility vehicles, both of which are made at the Wayne assembly plant.
Struggling the most among Ford's brands was Jaguar, where sales fell nearly 33 percent.
DaimlerChrysler AG's sales fell 10 percent from a year ago. Unlike the two crosstown rivals, the company's decline was split more evenly between cars and trucks.
Overall, new car and truck sales came in at an annual sales pace of 16.5 million, down 6.2 percent from the 17.3 million pace in April 2002, according to Autodata Corp. With the generous incentives rolled out when the month began, automakers projected April auto sales would come in at a sales pace of about 17.5 million.
Yesterday GM extended much of its incentive program through June 2. Interest-free loans for 60 months are still available on most vehicles, but the Corvette and some luxury models have been excluded. The carmaker's April offerings were more extensive than those it kicked off after the Sept. 11, 2001, terror attacks.
Among foreign automakers, Honda saw sales jump 11.2 percent. Toyota sales were essentially the same as April of a year ago, slipping 0.9 percent. Nissan sales fell 4.2 percent to 60,940 vehicles, 19,966 trucks and 40,974 cars.
