The newly released December sales report, featured in The New York Times, showed Ford grew sales 33% in December from a year ago, making it the company’s best month since May 2008. Sales were also up among several major foreign manufacturers: 44% at Kia; 41 % at Hyundai; 24% at Honda; 23% at Toyota; 18% at Nissan; 16% at Volkswagen; 9% at BMW; and 8% at Mercedes.
“Excluding the ‘cash-for-clunkers’ months, this would constitute the strongest sales rate since September 2008, suggesting the industry is witnessing a real improvement in underlying demand for U.S. autos, which bodes well for 2010,” Brian A. Johnson, an automotive analyst with Barclays Capital, wrote in a recent note to clients. More positive news: The industry’s seasonally adjusted annualized selling rate has been rising steadily for several months, ending 2009 at about 11.5 million vehicles. For all of 2009, automakers sold about 10.4 million light vehicles, according to estimates provided by G.M. and Ford.
Not all suppliers experienced aggregate increases for the month of December. GM said sales declined 6% in December while Chrysler’s revenues were off 4% during the month. Total year-over-year sales were even more distressing for GM and Chrysler. G.M. said sales declined 30% for the year, while Chrysler’s revenues slide 36% on the year. For the industry as a whole, 2009 sales were down 21%.
SILVER LININGS
While December sales missed the mark for GM, there were some positive developments. GM dealers in the U.S. reported 160,996 retail deliveries in December—a 7% increase compared to last year, and a 50% increase over last month. And while sales of the “non-core” brands GM plans to shutter were off by more than 50% (including Pontiac, Saab, Hummer, and Saturn), retail sales of Chevrolet, Buick, GMC and Cadillac brands were up13%, or 146,419 units, for the month.
“The fact that our retail market share has increased two full points from the third to fourth quarters demonstrates that we are strengthening our brands,” said Susan Docherty, vice president, sales, service and marketing, GM. “We are delivering a healthier sales mix and earning consumer confidence through our launch vehicles, such as Chevy Equinox and Camaro, Buick LaCrosse, GMC Terrain and Cadillac SRX.”
In 2009, GM dealers delivered 2,084,492 vehicles, down 30% compared with 2008. “The year-over-year comparison reflects a 38% reduction in fleet, reduced overall incentive spending and the orderly wind-down of the Pontiac and Saturn brands,” Docherty said. “Our sell-down of Pontiac and Saturn inventory is 10 months ahead of schedule and we only have about 1,700 vehicles left–800 Pontiacs and 900 Saturns. This shows real progress in our action plans.”
Docherty pointed to other key December standouts:
- Retail sales of Chevrolet, Buick, GMC and Cadillac brands were 13% higher than in 2008–achieved with 47% less inventory than last year
- Chevrolet retail sales were up 14%, driven by strong sales of Camaro: 7,518 sales, the segment leader for 7th straight month; Traverse was up 92%; Malibu, up 34%; and Equinox was up 137%
- Buick retail sales were up 32% compared with a year ago on the continued strength of LaCrosse, up 370%, and Enclave, up 37%
- GMC retail sales were up 4% vs. December 2008 on strong Acadia sales, up 49%, and Terrain, up 197% vs. the vehicle it replaced, Pontiac Torrent
- Cadillac retail sales were up 7%, led by the 2010 SRX, with sales 357% higher than a year ago: 4,880 vs. 1,069
- December month-end dealer inventory of 385,000 – the lowest year-end level on record
- Total GM crossover retail sales were up 67%
“The year 2009 was a watershed year for us in many ways,” Docherty added. “From our dealer restructuring, to our focus on Chevrolet, Cadillac, Buick and GMC, we have made the difficult but necessary decisions to position our new company for success. We’re looking forward to 2010 as a year when the economy continues a modest recovery, industry sales begin to improve, and our outstanding new products build additional sales momentum.”
These are the hopes of GM’s new chief executive of General Motors, Edward E. Whitacre Jr., who during a press conference on Jan. 6 sought to assure the public that the automaker was on track to be profitable in the wake of its bankruptcy last summer. In a media briefing at the GM headquarters, Whitacre predicted that GM would both become profitable and be in a position to repay $6.7 billion in federal loans this year. GM has received $50 billion in federal aid in 2009, but most of that debt has been converted to equity in what Whitacre said was now essentially a private company.
The federal government owns 60% of GM’s shares, and an important goal of Whitacre’s is to position the company for a public stock offering that would help taxpayers recoup some of their investment. Whitacre said he was encouraged by GM’s sales in December, citing the face that revenues during the month were up 2% among the four brands GM is keeping. Additionally, Whitacre said he expected that “a large number” of GM dealers who had been jettisoned during bankruptcy were likely to be reinstated through an appeals process approved by Congress.
Source: The New York Times, General Motors
