General Motors, Ford and Chrysler posted higher July sales, helped by demand for crossovers as well as small, fuel-efficient vehicles. Hit the jump to read the rest of the story.
Funk Flex
GM said today its sales rose 8 percent last month from a year ago, with passenger car demand rising 8 percent and crossover sales increasing 20 percent. At Ford, sales rose 6 percent, with car demand advancing 3 percent and light truck sales up 12 percent.
Chrysler’s July sales increased 20 percent – helped by several new models and a 46-percent increase in Jeep volume. Volkswagen AG said sales at its VW brand rose 22 percent on higher demand for the Jetta and models equipped with diesel engines.
The results from Detroit automakers follow projections of another month of soft demand for the industry. The average seasonally adjusted sales rate forecast from analysts surveyed by Bloomberg was 11.8 million, the third straight month below 12 million.
While U.S. light vehicle sales rose 13 percent this year through June, demand has weakened in recent months because of supply shortages stemming from the March earthquake in Japan, a sharp drop in incentives, volatile fuel prices and the sluggish economy.
“There are people who put off vehicle purchases because of uncertainty about fuel prices, vehicle availability and the economy,” said Don Johnson, head of U.S. sales for GM. “As these conditions improve in the latter half of this year, many of these buyers will return to the market.”
GM said the protracted debate in Washington over whether to raise the nation’s debt ceiling also cast a cloud over sales last month. And gasoline prices – while stabilizing at around $3.70 a gallon nationwide – continue to weigh on the minds of many motorists.
“The auto industry is having a difficult time shaking off adversity,” said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates.
While demand has softened, transaction prices are rising, offering a silver lining for some automakers.
TrueCar.com estimated today that the average transaction price for light vehicles rose $582 to $29,761 in July 2011 from a year ago. And average transaction prices rose $102 – or 0.3 percent – from June 2011.
“Despite continued weakness in the economy and the ongoing concern over the debt ceiling, consumers continued to purchase vehicles packed with options in July,” said Jesse Toprak, an analyst with TrueCar.com. “Tightened inventories, lower dealer discounting and manufacturer incentives, along with a more expensive product mix resulted in the highest transaction prices we have recorded in the industry.”
Demand for big pickups – a bright spot early in the recovery and a source of hefty profits – softened for some Detroit automakers. Ford said F-Series sales dipped 2.7 percent last month and Chrysler said Ram pickup sales increased 1 percent.
Sales of GM’s large pickups declined 3 percent from a year ago but inched up 2 percent from June, the automaker said.
“The increase in industry sales of full-size pickups is consistent with our forecast, as more truck buyers come back into the market,” Johnson said. “We expect continued modest growth in the segment for the remainder of the year.”
Japanese automakers are expected to lose ground again in July because of shortages of cars and light trucks. Nissan Motor Co. said its sales rose just 3 percent last month.
U.S. stockpiles of Japanese models stood at 568,800 units on July 1, down from 598,400 in early June and 730,200 on May 1, according to the Automotive News Data Center.
