GM, Ford U.S. Sales Fall in April; Honda, Toyota Gain
By: Administrative Account | Source: Bloomberg
May 2, 2006 4:54PM EST

May 2 (Bloomberg) -- General Motors Corp. and Ford Motor Co. said U.S. sales fell in April and their biggest Japanese rivals gained as rising gasoline prices pushed buyers toward models with better fuel economy. GM, the world's largest automaker, reported an 11 percent decline in sales, and Ford said sales dropped 6.6 percent. Toyota Motor Corp. and Honda Motor Co., the biggest sellers of Japanese autos in the U.S., had gains of 4.5 percent and 2.6 percent, respectively. For the first month ever, Toyota, including its Lexus and Scion brands, outsold DaimlerChrysler AG's Chrysler, Jeep, Dodge and Mercedes-Benz to rank No. 3 in the U.S. ``It's the price of gas that is driving all of this,'' said Rebecca Lindland, auto analyst at Global Insight Inc. in Lexington, Massachusetts. Gas prices are ``making everything else more expensive as it drives up the cost of doing business.'' Reduced demand for light trucks such as sport-utility vehicles hurts the U.S.-based automakers more than Asian companies, whose sales include a higher percentage of cars. GM and Ford have been surrendering market share to Honda, Toyota and other Asian competitors, which the U.S. government says have vehicles with greater average fuel economy. GM and Ford are also trying to end losses by cutting less profitable sales to rental-car companies and reducing reliance on rebates and other incentives. Ford and Chrysler added no-interest loans on some vehicles and GM sweetened its incentives after their sales declines. The Asian automakers are expected to gain U.S. share for the ninth straight month. April sales probably fell to an annual rate of 16.6 million cars and light trucks, from a 17.2 million pace in April 2005, according to a Bloomberg survey of analysts and economists. Automakers have sold an average of 17 million vehicles in the U.S. each year this decade. Ford's SUVs Fall Ford, of Dearborn, Michigan, sold 262,722 cars and trucks, according to a statement today. Its figures include imports and heavy-duty trucks. Ford said car sales rose 8.3 percent to 105,655, helped by new models such as the Ford Fusion, Lincoln Zephyr and Mercury Milan sedans. Truck sales dropped 14.5 percent, led by a 42 percent decline for the Ford Explorer SUV and a 9.3 percent decline in F-150 pickups. ``We weren't disappointed on overall sales, but cars did better and trucks didn't do as well as we thought,'' said Ford sales analyst George Pipas in an interview. ``I think it's more fuel than anything. When you see these very rapid run ups, people get a little cautious.'' GM's Trucks GM's sales of light trucks fell 2.1 percent. Models such as the mid-size Chevrolet TrailBlazer SUV continued to decline while the Chevy Tahoe and other new, large SUVs gained. GM's car sales fell 21 percent, and Detroit-based GM sold fewer models to rental-car companies. Chevy Malibu sales dropped 9 percent. GM shares gained after the results showed the large SUV sales continued to increase. GM had record first quarter revenue and narrowed the loss to $323 million from $1.25 billion in part because of increased production of large SUVs. It's Fuel DaimlerChrysler, of Stuttgart, Germany, said sales fell 6.2 percent to 211,365 in April. The Chrysler group declined 8 percent. Mercedes-Benz increased 13 percent to 21,270, an April record, led by sales of luxury SUVs. Hyundai Motor Co., of Seoul, sold a total of 41,025 vehicles in April, a 0.2 percent increase. The company said its Sonata sedan, a mid-size competitor to the Honda Accord and Toyota Camry, gained 46 percent. Nissan, No. 2 in Japan, saw sales fall 5.3 percent to 86,720, sales chief Jed Connelly said in an interview. The average U.S. retail price for regular gasoline rose to $2.92 a gallon this week, the highest since September and an increase of 13 percent from the beginning of April, according to Energy Department figures. The record was $3.07 in September. Rising fuel prices caused 62 percent of consumers to say they may rethink what vehicle they buy, the highest level since August 2005, a few weeks before gasoline reached a record, according to a study by Harris Interactive and Kelley Blue Book Marketing Research released last week. Nineteen percent were considering a small sedan, up from 15 percent in March. Yaris, Fit April was the first full month for sales of the Toyota Yaris and the Honda Fit sold 3,792 units in just 10 days in April. It was the second full month for the Caliber, which rose to Chrysler's second-best selling car behind the 300 sedan in April. Among 13 categories included in the U.S. Environmental Protection Agency fuel economy guide for 2006 models, Asian or European models led six of eight car and station wagon categories and Ford and GM models led four of five truck and van categories. Most cars get better fuel economy than trucks. The Honda Insight hybrid had the best car fuel economy, at 66 miles per gallon in highway driving and the Ford Escape hybrid SUV led trucks with 36 miles per gallon in the city. The U.S. National Highway Traffic Safety Administration data for 2005 Corporate Average Fuel Economy, a way of measuring the fuel economy of all the models an automaker sells, found that the average for most Japanese and Korean companies' cars and trucks were more fuel efficient than those from U.S. and European automakers. The 2006 data is not yet available. Some automakers adjust for the number of days during the month that dealerships were open for sales. Last month had 26 selling days, one fewer than April 2005. Because of the one-day difference, changes in unadjusted unit sales would be about 4 percentage points lower than the adjusted numbers.

To contact the reporters on this story: Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net; Greg Bensinger in New York at gbensinger1@bloomberg.net Last Updated: May 2, 2006 16:29 EDT