No triumphal March for auto sales
Forecast: Cars up, trucks down for U.S. carmakers
Analysts and automakers expect March vehicle sales to be flat compared with last year, with reduced truck sales buoyed by stronger sales of cars and car-based utility vehicles.
U.S. sales results for Detroit auto companies are expected to continue to reflect a slower housing market's depressing effect on truck sales and General Motors Corp.'s and Ford Motor Co.'s efforts to reduce sales to car-rental companies. Detroit automakers are also continuing to work through production cuts, analysts said.
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OAS_AD('ArticleFlex_1'); Meanwhile, the three largest foreign automakers in the United States are expected to report sales gains in year-over-year comparisons, thanks in great part to their established success in the small and midsize car segments, analysts said. "Mainly what went up in March was compact cars," said Jesse Toprak, executive director of industry analysis for Edmunds.com. "The trucks are actually recovering, too. The size of the truck market will not expand in 2007, but it will hold its ground. That's going to be a result of new products."
GM and Toyota have new pickups on the market, and GM has a series of new SUVs and crossovers that have been doing well in their first few months of sales.
But even Toyota, which analysts say rarely offers incentives on new models, announced a $1,000 to $1,500 incentive on its new Tundra full-size pickup this week to remain competitive in a tough truck market in which domestic automakers held a 91% share in 2006.
For March, Edmunds forecast:
• Ford sales would fall 17.2%.
• Chrysler Group sales would drop 6.2%.
• GM sales would be down 1.3%.
• Nissan would be up 1.1%.
• Honda would enjoy a 3% bump.
• Toyota would rise 8.8%.
Other analysts were generally in agreement with the Edmunds.com predictions that Chrysler and Ford sales would be weaker than a year ago, GM and Nissan would be relatively flat and Toyota and Honda would see improvement.
GM's chief market analyst Paul Ballew said the automaker expects retail sales to "have a solid month," but because fleet sales will be down about 20% -- or 15,000 vehicles -- he wouldn't forecast a total result for the month.
Ballew said GM has had solid sales of trucks and car-based utility vehicles, such as the GMC Acadia, and a "terrific first quarter" for sales of its Chevrolet Impala, Saturn Aura and Pontiac G6 sedans.
Ford's chief sales analyst, George Pipas, said discounted sales to businesses and other large-volume customers would be down in the double digits again in March. Ford reported a 42% decline in so-called fleet sales in January and a 20% decline in February.
"Our retail business will probably be off from last year as well," he said, in part because of a particularly strong sales month last year. "March was the best month of the year in 2006: We had our highest retail volume of all the 12 months last year."
Ford will see a big hit in its F-series pickup sales, he said, because of particularly strong sales last year related to the reconstruction of the gulf coast following Hurricane Katrina and because of the weakness in the housing market this year.
"So much of our F-series truck business is closely tied to construction spending," Pipas said. "About 40% of our truck business is the Super Duty -- the F-250 and the F-350. That's a higher mix than for the rest of the industry. ... In this kind of housing market, it does hurt us to a greater extent than the other competitors."
But both car and car-based utility vehicle sales will help the automaker to offset some of the declines Ford is seeing from fleet sales, Pipas said.
"I think it's quite likely the Ford Fusion, Mercury Milan and Lincoln MKZ are all going to post double-digit increases in retail sales," he said.
Edmunds.com's Toprak said compact cars are the growth segment in the U.S. market at this point, along with the reloaded Saturn lineup.
"The Saturn brand has been doing phenomenal," he said. "The Honda Civic, the Chevrolet Cobalt, the Chevrolet Aveo, the Toyota Prius are all going to do well."
The Chrysler Group, Toyota Motor Sales U.S.A., American Honda Motor Co., and Nissan North America all declined to provide data on their March sales results until the month is over.
Credit Suisse analyst Chris Ceraso said he expects Chrysler to report lower sales of its cars and trucks and foreign brand sales to be flat to up 2% overall.
"We look to foreign brand light trucks to be down 3% to 5% and passenger car sales to be up 3% to 5%," Ceraso wrote in a report released Thursday.
Contact KATIE MERX at 313-222-8762 or kmerx@freepress.com.
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Domestic sales hammered in March
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