Strong pickup truck sales boosted U.S. autos in May

| June 4, 2013

Pickup TrucksCourtesy of Reuters by Bernie Woodall and Deepa Seetharaman: Strong pickup truck sales, spurred by an improving housing market, boosted May U.S. auto sales after a disappointing April, automakers reported on Monday.

The three major U.S. automakers dominate pickup truck sales, which generally are sold at a higher profit margin than other vehicles.

The surge in pickup truck sales began late last year and has continued to outpace growth for the U.S. auto industry through May.

Pickup TrucksPickup truck sales in May rose about 2 percentage points to 11.7 percent of the overall industry, Ford Motor Co (F.N) said.

“Quite simply, it’s a great time to be in the truck business,” said Kurt McNeil, head of U.S. sales operations for General Motors Co (GM.N). “The housing recovery, relatively stable gas prices, and the release of pent-up demand” have helped pickup trucks sales.

Total U.S. auto sales were on track to exceed analyst expectations of a 6 percent rise from last year, to about 15.1 million vehicles on a seasonally adjusted annualized rate.

GM said that May U.S. sales will be between 15.4 million and 15.5 million on a seasonally adjusted annualized rate.

However, GM, the No. 1 automaker in U.S. sales, missed analysts’ expectations by nearly 6 percent, showing a 3 percent sales gain for May.

McNeil said GM expects its U.S. market share to “be slightly down” in May due in part to a 10 percent fall in sales to fleet customers, which include government, business and rental agency buyers. GM’s retail sales, which are generally more lucrative than fleet sales, rose 9 percent.

Ford, No. 2 in the U.S. market, recorded a 14 percent sales gain, slightly beating expectations. Toyota Motor Corp (7203.T), No. 3 in the U.S. market, had a 2.5 percent sales increase, matching expectations.

Auto sales each month are an early snapshot of U.S. consumer spending. If total U.S. sales reach 15 million vehicles on an annualized basis in May, it would be the sixth month of the last seven to top 15 million, after dropping to 14.9 million in April.

Chrysler Group LLC, No. 4 in the U.S. market, reported an 11 percent rise, easily beating analysts’ expectations.

“It is both the housing sector recovery and the energy boom that we are seeing these days that is positive for the full-sized pickup sales,” said Ford economist Jenny Lin.

Sales of the Ford F-Series pickup truck, the best-selling vehicle in North America since the 1970s, soared 31 percent for its best May performance since 2005.

GM’s top-selling vehicle, its Chevrolet Silverado pickup truck, showed a 25-percent gain in May. Chrysler’s Ram pickup truck, by far the company’s best-selling vehicle – rose 22 percent.

At GM, sales of two of its top-selling sedans, the Chevrolet Malibu and the Chevrolet Impala, fell 36 percent and 32 percent, respectively. GM said the Impala and Malibu sales figures were skewed due to a high rate of fleet sales in 2012.

Chevrolet, which accounted for 71 percent of GM’s May U.S. sales, rose only 1 percent in the month.

NISSAN SALES UP 25 PCT

Nissan Motor Co (7201.T) U.S. May sales rose 25 percent, slightly beating expectations, to 114,457, on the strength of sales of a fresh lineup led by its top-seller Altima, up 41 percent.

Nissan is No. 6 in U.S. auto sales.

Sales for the Rogue, a crossover SUV and Nissan’s second-biggest seller in the U.S. market, showed a 45-percent gain.

Jose Munoz, head of sales for Nissan in North America, said the strong showing in May is due to the automakers fresh lineup and has little to do with the price cuts made last month to models that comprise 65 percent of its U.S. offerings.

Honda Motor Co (7267.T), No. 5 in the U.S. market, showed a 4.5 percent sales gain to 140,013 vehicles, narrowly missing expectations.

Sales of the Dodge Dart, which Chrysler is counting on to help it expand its lineup into smaller, fuel-efficient cars, fell 8 percent from April, to 7,448 vehicles. It was the first month-to-month sales decline for the Dart in six months.

Analyst Jim Hall of 2953 Analytics said the company needed to increase consumer awareness that the Dart is a viable small car after it spent years producing the poor-quality Caliber.

“They launched the Dart without saying it was a small car,” Hall said. “They sold the image but not the car.”

Hall said Dart sales might rise now that the company is advertising its price. Chrysler introduced the car in June 2012.

Pickup Trucks in LotOnly one of seven analysts who forecast Chrysler May U.S. sales, expected an increase as high as 11 percent, and two forecast a drop for the suburban Detroit company. On average, they expected a sales rise of 6 percent for Chrysler.

Subaru of America, a unit of Fuji Heavy Industries (7270.T), showed a gain of 34 percent to 39,892 vehicles sold, while Volkswagen AG (VOWG_p.DE) said its U.S. sales fell 1.7 percent, to 38,013 vehicles.

Hyundai Motor Co (005380.KS) and Kia Motors Corp (000270.KS), which have the same corporate parent and together are the seventh-biggest auto seller in the U.S. market will report monthly sales later on Monday.

Luxury automaker BMW (BMWG.DE) reported a 10 percent sales gain to 31,174 vehicles to 31,174 vehicles. Mercedes-Benz of Daimler AG (DAIGn.DE) also showed a 10 percent sales increase, to 24,713.

Category: Featured, General Update, Vehicles

Comments are closed.