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Surprises in First-Quarter Sales
Who’s up and down? You’ll be intrigued.
by Mike Davis (2004-04-19)

Usually we wait until past mid-year, say around August or September, to bring you a preview of how the various car and truck lines and brand names are faring in the annual sales race.

But this year there are some interesting trends spotted early on, after only three months, which we think are worth spotlighting.

Overall, some 3,911,000 light vehicles were delivered by U.S. dealers, up about four percent from 3,763,000 last year.

Among brands, the big stories are gains by Nissan and Chevrolet, the first not surprising, the other unsuspected.

Hybrid weakness?

We'll get to these in more detail after the more important trend story: the weakness of economy cars, including the highly heralded hybrids especially in the face of rising gasoline prices.

According to the auto club (, the average U.S. retail price for a gallon of unleaded as of April 19 was $1.803, up about 23 cents from a year earlier. In California, Nevada, and Hawaii, it was over $2.

Needless to say, the trend against fuel-sippers goes against conventional wisdom, especially that of politicians and newspaper editorial writers.

But, as Joe Friday used to say, "Just the facts, ma'am."

According to the EPA fuel economy ratings for 2004 models, the most economical cars (automatics with estimated annual fuel cost under $700) on the market are, in order, the Honda Insight, Toyota Prius, Honda Civic Hybrid, the VW diesels, the Honda Civic with CVT, Toyota Echo, the Honda Civic with VTEC, the plain Civic, the Toyota Corolla, Nissan Sentra, and the Hyundai Accent.

Now get this: only the Prius (9918 sales, up from 6106 last year) and the Sentra (32,160, up from 23,150) are clearly ahead this year. The Honda Civic Hybrid at 5981 is down from 6494 and the Insight sold a mere 187, compared to 501 in the first quarter of 2003. Automotive News, from which most of these numbers were derived, doesn't break out VW diesel numbers, but overall, VW Golf/Jetta/New Beetle sales of 29,200 are way down from 46,200 in the comparable period.

Toyota's regular entry-level economy car, the Echo, has collapsed with only 1,338 deliveries against 9556 a year earlier. The Corolla and Accent are off and the Civic is barely ahead.

Among Motor City's economy cars, the Dodge Neon at 33,000 is a hair ahead but the Focus at 48,000 trails the year before by about 12,000 units. Ford dealers also are selling remaining Escorts from old inventory a bare 1200 in the quarter - since production ended long ago. Only Chevy's economy cars, the Aveo and Cavalier as a group, are robust at 58,000 (up 5000), thanks to a new model and the brand's general upsurge.

And note that hybrid sales in total come to only 16,000, a mere four percent of the market despite all the hullaballoo. By comparison, Hummer, the Caddy Escalade, and the Lincoln Navigator - the recipients of much elitist scorn - sold 27,000 in the same period, moreover at prices two to three times those of hybrids. And only Hummer, with 6400 sales in the first quarter, was trailing.

So celebrities are grandstanding with Priuses rather than Honda hybrids because the Toyota is, by design, unmistakably "green" whereas an equally green Honda just makes it look like they couldn't afford anything better.

All this suggests two things: corporate average fuel economy (CAFE) is in the hands of consumers, and slapping on a big gasoline tax hike seems unlikely to change the public's vehicle choices.

Bigger volume trends

Now to important trends in the volume segments of the auto market.

Nissan chalked up an impressive 61,000 gain in sales for the January-March quarter, a 35-percent increase, going from 176,000 to over 237,000. Biggest contributors were the new Titan which, although disappointing compared to anyone else's big truck, provided 14,000 units to the Nissan total. The Altima at 63,000 was up 13,000 and the Quest at 12,800, up 10,600.

Note: for most of this report, I'm going to stick to just the rounded-off "boxcar numbers" of over 10,000 units. Obviously smaller-number gains provide big percentage improvements for smaller makes but the real significance is always in the big numbers.

The real surprise has been Chevrolet's strong comeback. Chevy car sales totals of nearly 211,000 surpassed both Ford and Toyota cars in the first quarter.

Leading the pack was the Impala, which has continued to gain sales even after five years with scarcely a change. The Impala's 72,600 sales (up 13,800) passed the Taurus's 68,700, closing the gap on the Accord's 83,200 and the Camry at 96,180. It's widely known that Ford ceased pumping Tauruses into rental fleets in order to improve profitability at the expense of market share, but the Impala's secret is unclear.

Chevrolet's new entry-level Aveo and the combination of new Malibu and old Malibu (renamed Classic for reporting purposes) added some 27,000 units to the Chevy brand between January and March. Altogether, Chevy car sales were 40,000 ahead of 2003.

On the truck side, the new Colorado, Equinox, and SSR plus upticks for Silverado, Suburban, Tahoe, and TrailBlazer boosted truck deliveries by a net 17,000 to nearly 387,000.

Across town at Ford, the somber mood over falling car sales - except for Crown Vic (plus 11 percent) and Mustang (up 16 percent) is offset by overall better truck sales. Gains included, as expected, 25,500 additional market-leading F-Series plus added deliveries of the Escape and Explorer. The new Freestar didn't fare so well, the combination of new brand and carryover Windstar falling short of last year's Windstar alone. Ford truck sales totaled 485,500, still well ahead of anyone else.

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