“We’re a little weaker than what we expected to be in June,” Paul Ballew, GM’s head of sales analysis, reportedly told Reuters in an interview this past Monday. What he did not say was that GM’s monthly numbers would drop a stunning 15.5% from June 2003, in spite of near-record incentives on some models.
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The news from Dearborn wasn’t much better as Ford reported a 12% drop, based on daily sales rate (DSR). Even Premium Automotive Group brands had bad months, as Jaguar, Land Rover and Volvo all missed their 2003 marks. Volvo did get some good news. It posted record sales numbers for the first six months of the year and has passed Lincoln in both monthly and year-to-date (YTD) sales to become Ford’s best-selling luxury marque.
Chrysler was the only Detroit automaker sporting a smile; happy with a 1% gain, based on strong sales of its new Hemi-powered Chrysler 300, Dodge Magnum and Dodge Durango.
After May’s very strong results, most industry analysts had been looking for flat sales in June and the overall numbers did not disappoint. Ward’s reported 1,443,615 light vehicle sales, down over 40,000 units, or about 6% from June 2003.
The market mavens were also predicting gains by the import brands, which were happy to deliver. Toyota posted record June numbers as it closed out its best first half in history. American Honda also had an excellent month, as both its Acura and Honda brands enjoyed record June sales. Nissan, the third of Japan’s power players, came in with a 9% improvement shared by its Nissan and Infiniti brands.
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By GlobalDataResurgent Mazda reported its ninth month of improved sales and Subaru enjoyed a nice bump thanks to good results from the new Legacy and Outback models.
Suzuki reported a record June, driven solely by the Forenza and Verona sedans. Without the GMDAT cars, Suzuki’s result would have been far different. Sales of its own vehicles plunged an average of 43%.
Mitsubishi continued to prove that being a Japanese car company is not an automatic guarantee of success. Sales were down by 45%, blamed on declining fleet sales.
Both Hyundai and Kia posted new records. Kia set a new benchmark for the month while parent Hyundai set a new all-time sales record.
The new X3 SUV helped BMW knock Lexus off the top of the luxury segment in June, but Toyota’s upscale brand still leads in YTD sales. Mercedes edged out Cadillac to take the third position, even though this year’s extra selling day turned a small volume improvement into a 2.6% DSR drop.
Sales of luxury brands have remained fairly constant, claiming between 10 and 11% of the market every month this year.
Even though petrol prices declined through June, total SUV sales took the hit most industry watchers were looking for in May, dropping to their lowest level this year, based on market percentage. Sales of pickups also dipped slightly.
Sales of the larger American SUV models continue to be a segment to watch. Thanks to a strong start at the beginning of the year, YTD sales of the big truck-based wagons are still ahead of 2003, but by a grand total of just 32 units, or about 0.05%. In the same period, total light vehicle sales have grown by about 2.2%.
With very aggressive promotion and incentives almost as large as the vehicles themselves, GM is still about 1.02% ahead for the first six months, but has lost ground in the second quarter. Ford has been hard hit. Sales of almost all of its mid-size and larger models are off. Overall, sales of larger Ford SUVs are down 7.77%. Both Ford and GM are still trying to clear uncomfortably high inventories.
It may be that mature products are having as much of an effect as fuel prices. Chrysler is bucking the downward trend. YTD Durango sales have grown 25.88%, the best performance of any large domestic SUV. Combined sales of the Durango and Jeep Grand Cherokee are up 13.63%.
It’s worth noting that sales of Toyota’s big Sequoia are also down: 19.9% down for June, 7.1% for the first half of 2004.
As was the case last month, the big growth segment was minivans, which picked up almost a point of market share compared to June 2003. For the second month in a row, Honda’s Odyssey outsold the Toyota Sienna, though both were well off the pace set by the Dodge Caravan. Ford’s revised Freestar continues to struggle, coming in fifth behind the Chrysler Town & Country.
Even though it wasn’t enough to put VW in the winner’s column last month, consumer concerns about long-term fuel prices are credited with boosting sales of Volkswagen’s Jetta and Passat diesel models by 46% over last year’s numbers.
Passenger cars made their best showing of 2004 last month, though they still gave up another 0.3% market share to light trucks measured against the June 2003 breakdown. The Toyota Camry is now over 20,000 sales ahead of the Honda Accord. The Taurus remains the best-selling American car in YTD numbers, even though the Honda Civic has edged it out of the money. The Chevrolet Impala, which looked to take over the top spot among American-badged cars, has stumbled in the past two months.
Almost all industry analysts are expecting solid growth for the industry for the rest of the year, with some looking for numbers approaching 2000’s all-time record as more new product hits dealer lots. The one concern is how much Detroit will share in the bounty. The Big Three dropped below 59% of light vehicle sales for the second time in 2004 and have not hit 60% since last December.
Bill Cawthon
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