Sales Slide in Early June With BC-Auto Sales-Table
DETROIT (AP) _ Sales of North American-made cars and trucks slipped 13.1 percent in early June, mainly because there were fewer incentive packages in the period than during the same time last year, automakers said Wednesday.
The sales rate during June 1-10 last year wasn’t particularly strong, even though generous incentive packages initiated two months earlier had been extended. This year, incentives covered fewer cars and trucks, and rebates were lower.
Incentives, used to reduce new-vehicle inventories, cut directly into automakers’ profits.
Ward’s Automotive Reports, a trade journal, said that at the end of May, new-car inventories among the 10 major automakers with U.S. plants stood at 59 selling days, considered good for this time of year.
″The reason they are cutting back on incentives is that they haven’t overstocked the dealers,″ said economist Tom Webb of the National Automobile Dealers Association in McLean, Va.
But he said demand seemed to be softening beyond the falloff caused by reduced incentives.
The Commerce Department reported Wednesday a 0.7 percent drop in retail sales in May, the third straight month of decline. Some analysts interpreted the figure as an indication of sagging consumer confidence.
The automakers reported they sold vehicles at an average daily rate of 30,412 during the early-June period this year, compared with a rate of 34,994 during the same period last year.
Car sales fell a 15.5 percent and truck sales were off 8.8 percent.
Sales of the domestic cars made by General Motors Corp., Ford Motor Co. and Chrysler Corp. dropped 19.2 percent, while sales of U.S.-made cars with Japanese company nameplates rose 34.8 percent. The Big Three held 89.1 percent of the car market and the Japanese ″transplants″ held 10.9 percent.
For the year so far, domestic car and truck sales were 4.4 percent behind last year’s pace, with car sales down 5.6 percent and truck sales down 2.2 percent. Big Three car sales tumbled 10.8 percent compared with last year and transplant car sales were up 42 percent.
Chrysler’s early-June overall sales were 18 percent lower than last year’s. Car sales dropped 16.7 percent and sales of light trucks, which provide much of the company’s profits, were off 19.1 percent. The company’s vehicle sales so far this year declined 13 percent from last year.
GM said its combined early-June car and truck sales were 16.7 percent behind last year’s pace, with car sales down 19.2 percent and sales of light trucks off 11.3 percent. So far this year, GM has sold 4.8 percent fewer vehicles than last year.
Ford reported a 12.4-percent drop in early-June car and truck sales, with a 20.2-percent decline in car sales blunted by a 0.5-percent increase in truck sales. Ford spokesman Joel Pitcoff credited sales of the company’s new Explorer sport-utility vehicle as the main reason for the increase.
Since Jan. 1, Ford’s vehicle sales are down 8.8 percent.