Fuelled by widespread incentives and an improving consumer outlook, US light vehicle sales rebounded nicely from their June swoon with a refreshed demand for sport-utility vehicles and pickups.
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Ward’s reports total sales of over 1.55 million cars and light trucks in July for an annualised sales rate of about 17.3 million vehicles, well up from June’s 15.3 million mark. Sales volume actually exceeded that of July 2003, but an extra selling day last month turned a 2.9% surplus excess into a 1% deficit, adjusted for daily sales rates (DSR).
Several of the import brands posted new records in July. Based on combined sales of its Nissan and Infiniti lines, resurgent Nissan reported a 31% increase in sales for an all-time record. Toyota, Honda, Mercedes and Hyundai also reported record July sales volumes.
Though both missed their very strong 2003 benchmarks, the news from GM and Ford was generally positive, with both automakers reporting their best retail sales of the year. GM’s unadjusted totals actually beat those from last year, and even the adjusted 3.6% deficit was better than some market projections. Both GM and Ford reported near record sales of SUVs, with GM’s large Cadillac and GMC models turning in especially strong performances. Sales of the luxury Escalade were up over 50% as GM’s premium marque had its best sales month since 1990, coming in second only to Lexus in the luxury segment.
Volvo set a new July sales record as it continued to build up a solid lead as Ford’s best-selling upscale brand. So far this year, volume is up 2.6% over last year.
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By GlobalDataChrysler was the only member of the Detroit Big Three to beat its 2003 mark as its new products continued to work their magic on car buyers. Sales of the reborn 300 series and revised Crossfire propelled the Chrysler brand to a new July sales record.
Mitsubishi took another major hit as sales dropped 51%. The beleaguered Japanese automaker cited reduced sales to rental fleets and tightening of credit as the cause.
BMW car sales dropped 25% in July as sales of the 5-series and 7-series declined by 50% and 45%, respectively. Sales of the new X3 SUV were strong, but not enough to keep the Bavarians out of the loser’s column. Hampered by low inventories, sales of the Mini also missed their 2003 target.
While sales of SUVs were strong in July, there was still some weakness in the larger models. While upscale vehicles like the Cadillac Escalade and Lincoln Navigator did well, similar vehicles wearing the Chevrolet and Ford badges did not. Toyota’s Sequoia is also lagging behind its pace of a year ago as crossovers and car-based models continue to make inroads on the traditional trucks.
Pickups also had mixed results. Nissan’s new Titan posted 8,726 sales, which would put it on the pace to reach its 100,000-unit annual goal. Sales of the Ford F-Series and Toyota Tundra were also in positive territory. Sales of Chevrolet and Dodge full-size pickups were down.
As predicted, import brands claimed a larger piece of the US market in July as Detroit’s domestic brands combined share remained below 59%.
Passenger car sales dropped to a new low in July. With Chrysler being the only American brand to boast improved passenger car sales, the imports’ piece of what is still the largest market segment now stands at over 58%. Both GM and Ford are counting on new products coming this fall to reclaim some lost territory.
Most industry analysts are looking for the remainder of the year to be favourable, possibly coming at a near-record 17 million-plus sales. Even though oil prices remain in a state of flux, American consumers seem to have either taken higher petrol prices in stride or decided the generous incentives more than make up for the difference.
One thing that probably won’t change is the need for incentives to move the product. Even Honda is offering dealer cash to close deals and the talk of ending zero-interest financing and cash rebates has fairly well dried up.
Bill Cawthon
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