Posted on: Saturday, April 2, 2005
Vehicle sales rebound in March
By Sarah H. Webster
Knight Ridder News Service
DETROIT After two straight months of disappointing auto sales, consumers did an about-face last month and purchased 1.6 million new cars and trucks 68,807, or 4.6 percent, more vehicles than the same month last year.
Heading into March, auto sales were down 3.6 percent compared with 2004, leading Detroit's two largest automakers to cut production and causing anxiety on Wall Street.
So the bounce-back this March signaled the start of a welcome spring selling season.
Leading into March, sales were down at General Motors Corp., Honda Motor Co. and Ford Motor Co.
They were up at Nissan Motor Co. Ltd., Toyota Motor Corp. and DaimlerChrysler AG's Auburn Hills, Mich.-based Chrysler Group.
March was such a good month that the outlook improved for all the nation's biggest automakers. GM, Ford and Honda narrowed their losses, while Toyota, Nissan and Chrysler posted bigger gains.
For the quarter, sales ended down 5.2 percent at both GM and Ford and down 1.2 percent at Honda.
Meanwhile, sales were up 11.5 percent at Nissan, 9.1 percent at Toyota and 5.6 percent at Chrysler, which continues to celebrate the success of its new model lineup.
"You've got to have great products, and your pricing has to be competitive," said Gary Dilts, senior vice president of sales at Chrysler.
At the same time, Paul Ballew, GM's executive director of global market and industry analysis, called the improved results in March comforting.
Many industry experts were closely watching the results from Detroit-based GM, which recently lowered its profit projections for the year and seems to be struggling more than others in the marketplace, despite a lineup of new cars, such as the Pontiac G6 and Buick LaCrosse.
But dealers reported that GM's March Madness marketing program, which offered $1,000 on vehicles that had been sitting on dealer lots for more than four months, as well as other deals, were largely a success.
GM's Chevrolet brand with a big boost from the increasingly popular Cobalt outsold the Ford nameplate during March by about 5,111 vehicles, with a total of 256,375 Chevy cars and trucks sold, according to Autodata Corp. of Woodcliff Lake, N.J. For the year, Ford still has outsold the Chevy brand by about 10,292 vehicles.
Meanwhile, not all is well at DaimlerChrysler, the German owner of Chrysler Group.
DaimlerChrysler posted a sales gain of 7.2 percent in March compared to last year and a gain of 4.2 percent for the first quarter. But those results would have been far more impressive had it not been for the drag of the Mercedes-Benz brand. Mercedes sales were up 2 percent in March, compared with the same month a year ago, but down 10.9 percent for the first quarter, Autodata reports.
It's unclear how much of an impact rising gasoline prices are having on buying decisions, and automakers are reporting different findings.
Ford executives said consumers are moving to smaller, more efficient models.
"Higher gas prices seem to be accelerating the demand for small and crossover sport utility vehicles," said Earl Hesterberg, Ford group vice president for North American sales, marketing and service.
Ballew, meanwhile, insisted that gas prices are not having much impact, citing GM's high level of truck sales. March marked GM's best month of full-size pickup sales since 1978.
Chrysler's sale of minivans also continues to mount. Sales of the Dodge Caravan and Chrysler Town & Country, which come with the Stow 'n' Go seating and storage system, are up 22.4 percent for the first quarter.
While Dilts said consumers were offered as much as $3,500 in discounts on the vehicles, the sales increase has Chrysler in firm control of the minivan market. Chrysler's share of the minivan segment is up 6.3 percentage points this year, to 38 percent.
The Caravan is leading the pack, followed by the Town & Country. The Honda Odyssey and Toyota Sienna, meanwhile, are trailing.