Automotive News staff report
Detroit, Michigan -- US auto sales may have run at the fastest pace this month since the 2009 "cash for clunkers" programme as Toyota Motor Corp.'s incentives to counter global recalls spurred rivals to match the discounts.
Industrywide deliveries may have risen to an annualised rate of 12 million light vehicles, the average of eight analysts' estimates compiled by Bloomberg. Toyota said its sales climbed at least 35 percent.
"The deals are unbelievable right now," said Rebecca Lindland, director of automotive research for the Americas at IHS Global Insight in Lexington, Massachusetts. "This kind of sales activity is what we need to see in order to achieve the types of improvement being forecast for the year."
Domestic sales last reached this pace in August, when the government's rebates for scrapping old cars drew shoppers to showrooms. An increase in March would be the fifth straight monthly advance as automakers recover from the worst slump in the US market since 1982.
General Motors Co. may post a 25 percent increase tomorrow, while Dearborn, Michigan-based Ford Motor Co. may report a jump of 39 percent, based on the average of six estimates. Chrysler Group LLC may show a drop of 3.4 percent.
Toyota's sales rose at least 35 percent, Bob Carter, group vice president of US sales operations, said in an interview today at the New York auto show.
The Toyota City, Japan-based automaker will extend its no- interest loans and discount leases for at least a month and may make free maintenance standard for all US buyers, Carter said. Chrysler chief executive officer Sergio Marchionne decried incentives yesterday as "unhealthy" for the industry.
"There are a couple of players, who will remain nameless, who I considered to be engaged in, for their own benefit, a very unwise and unhealthy process," Marchionne said in New York at a conference sponsored by the National Automobile Dealers Association and IHS Global Insight. "Trying to get that back once you've gone down that path -- look at us, we had to go Chapter 11 to clean up our act."
Honda Motor Co., Japan's second-largest automaker after Toyota, may say sales rose 17 percent, researcher Edmunds.com said, while No. 3 Nissan Motor Co. may have a 43 percent gain. Hyundai Motor Co. may increase 35 percent, according to Santa Monica, California-based Edmunds.com.
The analysts' estimates are adjusted for the number of selling days in a month. March had 26 sales days, one more than a year earlier. Because of the extra day, adjusted sales will be about 4 percent lower than the actual figures.
Manufacturers, dealers and investors use the annualized rate to account for seasonal buying patterns when comparing monthly totals. The average estimate for an industry sales pace of 12 million vehicles would be a 23 percent increase from the 9.7 million of a year earlier, according to Autodata Corp.
It also would be the best month since September 2008, excluding August 2009, when the clunkers program concluded, according to data compiled by Bloomberg.
Automakers were buoyed by rising consumer confidence, as measured by the Conference Board's monthly index, and spring weather that followed February blizzards in the U.S. Northeast.
Sales rose for GM's four remaining brands, Susan Docherty, the automaker's marketing chief, said today in an interview. The company retained Chevrolet, Buick, Cadillac and GMC while disposing of four other lines as part of its 2009 bankruptcy.
Deliveries in March matched last month's levels, Stefan Jacoby, ceo of Volkswagen of America Inc., said today in a Bloomberg Television interview. The US unit of Volkswagen AG reported a 33 percent sales gain in February.
Marchionne said March has been a "good month," predicting an annual sales rate of 11.5 million vehicles. His projection, like those of the analysts, underscored the industry's contraction in the past two years. Annual US sales averaged 16.8 million last decade through 2007. The 2008 total was 13.2 million.
Sales "over the rest of the year will largely depend on how long the industry's pricing battle goes on," Brian Johnson, a Barclays Capital analyst in Chicago, said in a March 26 note to investors.
This is an external link and should open in a new window. If the window does not appear, please check your pop-up blocking software. ERJ is not responsible for the content of external sites.
Automotive News (a Crain publication)