October Shows a Gain in U.S. Auto Sales – A Car Pro Article

The smallest of the U.S. industry’s “big” automakers — Chrysler, Hyundai-Kia, and Nissan – drove U.S. auto sales to an 8 percent gain in October, matching February as the best-selling month of the year.
The smallest three of the “Big 7” posted double-digit gains. Chrysler Group sales jumped 27 percent from a year earlier; Hyundai-Kia Automotive gained 22 percent, and Nissan North America was up 18 percent.
No. 1 General Motors Co. rose 2 percent, with Chevrolet’s 6 percent growth offsetting falls at Buick, Cadillac and GMC. Ford Motor Co. sales were up 6 percent overall, led by a 13 percent increase at the Ford brand.
Both Toyota Motor Sales U.S.A. and American Honda Motor Co. lost volume in October, but for both it was the smallest loss in six months as they rebuild inventories slammed by post-quake production losses. Honda was off 1 percent; and Toyota, 8 percent.
Automakers sold 1,021,185 light vehicles last month, at a seasonally adjusted annual selling rate of 13.3 million. That matches February’s rate, is slightly ahead of September’s 13.1 million, and is up substantially from the 11.5 million pace in June — the year’s low point.
Automakers expect the momentum to continue despite lingering concerns about the pace of economic recovery.
“It appears we will see strength as we finish the year out.” said Erich Merkle, chief sales analyst for Ford.
Toyota Motor Sales didn’t see an October sales gain as Toyota Division General Manager Bob Carter had predicted a month ago, but it came the closest it has since the March earthquake in Japan slashed production and crimped U.S. dealer inventories.
“Looking ahead, we’re sticking with our fourth-quarter goal of exceeding year-ago quarterly sales,” Carter pledged today.
With stocks recovering, Toyota and Lexus introduced special financing and lease incentives on many 2011 and 2012 models even though their annual sales events typically don’t start until later this month.
“Our marketing campaign won’t begin until later this month, but the holiday incentives are in place right now,” said Mark Templin, Lexus general manager.
Jesse Toprak, vice president of forecasting at TrueCar.com, said the pace of recovery is deceiving because the industry is not using incentives to whip up a froth of sales as in the past.
“This is a healthier way to recover,” he said. “Just a few months ago, hitting a 13-million annually adjusted rate was a reason to throw a party.”
October was mostly feast or famine for automakers outside the Big 7.
Volkswagen Group of America led the pack with a 36 percent gain from a year earlier. With its U.S.-built Passat doing well, Volkswagen brand jumped 40 percent. The Audi brand rose 26 percent.
Others posting double-digit increases included, Daimler Benz Group, up 26 percent; Volvo, 23 percent higher; and BMW Group, up 17 percent.
By contrast, Subaru, Mitsubishi and Porsche all lost between 12 and 14 percent last month. The only small automaker in the middle was Mazda, up 2 percent. Suzuki dropped 5 percent.
Even as quake-related product shortages eased, U.S. incentive spending barely budged in September.
The average per-vehicle incentive last month was $2,669, up $16 or 1 percent from September and $116 or 5 percent from a year earlier, according to TrueCar.com.
Automakers hardest hit by production cuts after the March 11 Japan earthquake and tsunami boosted October incentives as they started to restock. Honda spent $2,380 last month, up 18 percent from a year ago. Toyota boosted spending 13 percent to $2,387. Nissan was up 15 percent to $2,917.
By contrast, Detroit 3 incentive spending was relatively flat, up 2 percent to $2,817 at Ford and 2 percent to $3,182 at GM, while Chrysler spiffs declined 3 percent to $3,303, TrueCar.com said. Hyundai-Kia spent $1,300 in October, off 23 percent.


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