Latest News

American Auto Sales, Best Performance in 20 Years


Detroit’s boom-and-bust history was built on a dependence on big, fuel-thirsty vehicles. Now, with freshly stocked showrooms of new cars and more-efficient trucks, U.S. automakers are gaining ground on their Asian competitors with the best lineup in a generation.
“No matter what the economy does, no matter what fuel prices are, I’ve got a car for all seasons,” said Chuck Eddy, a Chrysler dealer in Youngstown, Ohio, who is seeing sales boom for Dodge Dart compact cars and Ram 1500 pickups. “I didn’t have that in ’09.”
General Motors Co (GM), Ford Motor Co. (F) and Chrysler Group LLC -- which all gained market share in the first quarter for the first time in 20 years -- exceeded sales forecasts last month and led the industry to its best April since 2007.
Ford sales rose 18 percent and GM and Chrysler deliveries both increased 11 percent. That beat forecasts by analysts of a 17 percent rise for Ford and 10 percent for Detroit-based GM and Fiat SpA (F)-controlled Chrysler.
Sales successes came across the board for the U.S. automakers last month. Ford had a record April in Fusion family- car sales, which rose 24 percent and topped Nissan Motor Co. (7201)’s Altima. GM’s hot-selling new Cadillac ATS sports sedan drove a 34 percent increase in the surging luxury line’s sales. Chrysler’s redesigned Ram 1500 pickup jumped 49 percent.
“Detroit is arguably much more competitive than they have been, from the broad spectrum of their lineup, in a decade or more,” said Jeff Schuster, an analyst with researcher LMC Automotive. “Right now, Detroit has the momentum.”
Rising Share

Combined market share for GM, Dearborn, Michigan-based Ford and Auburn Hills, Michigan-based Chrysler rose to 46.2 percent so far this year, from 44.7 percent a year earlier, according to researcher Autodata Corp. Toyota Motor Corp. (7203), Honda Motor Co. and Nissan’s combined share fell to 31.8 percent, from 32.3 percent.

GM, which posted better-than-expected earnings today, jumped 3.2 percent today to $31.16 at the close in New York, the highest since July 8, 2011. Ford rose 0.2 percent to $13.41 and the S&P 500 Index climbed 0.9 percent to 1,597.59.
Japanese automakers that once seemed invincible now are making moves that would have been characteristic of Detroit’s bad old days. Nissan, which reported sales that trailed analysts’ estimates, said yesterday it was cutting the price of seven models, including Altima.
‘Boring’ Camry

Toyota’s April sales fell 1.1 percent, failing to achieve the 3.1 percent increase forecast by the average of eight analysts surveyed by Bloomberg. Its Camry sedan, the best- selling car in America for the last 11 years, was topped in April by Tokyo-based Honda’s Accord. Camry sales have fallen for three months compared with last year, as the staid standard- bearer lost customers to stylish new offerings such as the Fusion, which has looks evocative of an Aston Martin luxury car.

“The Camry has become so inoffensive that eventually it just became boring,” said Kevin Tynan, auto analyst for Bloomberg Industries. “Everybody has one and now nobody wants one.”
GM, meanwhile, is preparing to introduce a redesigned, more fuel-efficient Chevrolet Silverado pickup. Chrysler later this year will roll out a new Jeep Cherokee, which it plans to sell globally. And Ford is adding a factory shift of Fusion production in Michigan to try to keep up with booming demand.
“All of this bodes well for Detroit,” Schuster said. “It’s both ends of the spectrum.”
Pickup Power
Pickups, a traditional source of strength, are financing Detroit’s showroom renaissance. Analysts estimate that each big truck hauls in $8,000 to $10,000 in gross profit and account for the majority of earnings at the Detroit Three.
As ranchers and hardhats replace their old trucks, sales of pickups have risen about 20 percent this year and are growing almost three times as fast as total light-vehicle sales, said Erich Merkle, Ford’s sales analyst.
“Truck sales are going to continue to rise,” Eric Noble, president of the Car Lab, an industry consultant in Orange, California, said yesterday on Bloomberg Television. “This recession has been so long that businesses’ tools purchases have been put on hold. Trucks are tools. Those trucks wear out. People have to replace their trucks.”
Ford said today it’s adding a third shift of workers at its Kansas City assembly plant to produce the F-150 pickup. GM said this week that it had begun production of the new Silverado, which it says will get 23 miles (37 kilometers) per gallon on the highway. It goes on sale this quarter, the automaker said.
That growing source of profit has enabled the U.S. automakers to work on weaknesses in their lineups, such as luxury sedans and compact cars.
Luxury Lifts
Ford’s Lincoln luxury line reported its first positive month of the year, as its car sales soared 47 percent almost entirely on the doubling of deliveries of its $35,925 MKZ sedan. Lincoln dealers last month were fulfilling back orders for the redesigned MKZ, which stumbled out of the gate as the Mexican- built car required rigorous quality inspections at a Michigan factory. The problems with the MKZ, which Ford touts as the brand’s turnaround car, are resolved, the company said.
Cadillac continued its gains, which have propelled it into fourth place among luxury lines, behind BMW, Mercedes-Benz and Toyota City, Japan-based Toyota’s Lexus brand. Cadillac’s lowest-priced model, the $33,095 ATS, and its new $44,075 XTS flagship sedan accounted for most of its April sales gains.
That still leaves holes in Detroit’s luxury lineup, said Tynan, who is based in Skillman, New Jersey.
“Detroit is back in the game in entry luxury, but what about the move-up segments?” Tynan said. “The Germans do a better job of getting you up through their product portfolio. There’s a very clear path they put you on that I don’t think the domestic guys have.”
Compacts Climbing
More clear are the improvements U.S. automakers have made to compact cars, such as the Chevy Cruze, Ford Focus and Dodge Dart, Schuster said. Cruze sales rose 21 percent last month, Focus sales gained 16 percent and the Dart had its best sales month since its 2012 debut.
Since GM and Chrysler emerged from bankruptcy in 2009 and Ford financed its own reorganization, the U.S. automakers have been refreshing their showrooms rapidly.
“Toyota is in a bit of a holding pattern right now, waiting for new product to come out,” said Larry Dominique, president of Santa Barbara, California-based researcher TrueCar Inc.’s ALG and former product development chief for Nissan in North America. “My gut feeling is that there’s going to be a lot more changes with Camry pretty quickly.”
Toyota has a refreshed Camry coming next year, and an edgy restyling of its Corolla is due in showrooms later this year.
Weaker Yen
Toyota and other Japanese automakers also may receive a lift from the weakening yen, which they can use to cut prices, boost ads and improve products. The yen has fallen 18 percent against the dollar since Oct. 31. Morgan Stanley estimates that gives Japanese automakers a currency boost of a $1,500 per car, while the Detroit automakers contend the figure is $5,700.
“We have seen more aggressiveness in the incentive space from the Japanese,” Kurt McNeil, GM’s vice president of U.S. sales, told analysts and reporters on a conference call yesterday.
Nissan, based in Yokohama, Japan, said its price cuts aren’t related to the weakening yen and instead are aimed at getting sticker prices in line with what customers actually pay for their models. Besides Altima, Nissan is cutting prices on the Maxima sedan, Sentra small car and Juke, Rogue, Murano and Armada sport-utility vehicles. Price cuts range from $580 on the Altima to $4,400 on the Armada.
First Sign
“This could be the first major sign of a Japanese competitor leveraging the weaker yen,” Joe Spak, an analyst for RBC Capital Markets, wrote yesterday of Nissan’s price cuts. “The seeds have been planted to raise risk of a price war.”
Chrysler dealer Eddy remembers when all he had to sell was a cut-rate price. Now his showroom is filled with an array of competitive cars and his used-car lot is filling up with trade- ins from owners of Toyotas, Hondas, Audis and BMWs, he said.
“I’ve got European and Asian car buyers considering my cars,” he said. “When I sit here and look at the product mix on the showroom floor and the results of this renaissance and how Chrysler is now propping up Fiat in Europe, it’s amazing.”
To contact the reporters on this story: Keith Naughton in Southfield, Michigan at; Craig Trudell in Southfield, Michigan at; Mark Clothier in Southfield, Michigan at
To contact the editor responsible for this story: Jamie Butters at
Consumer Financial Services, E-Z LOAN$, would like to THANK all those who contributed to this very informative article for allowing us to share it on or website… Thanks Again

Have Questions? Let Us Know!

Contact Us Today!