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General Motors reverses US sales plunge

Upward trend: New models such as the Chevrolet Equinox have helped to steady GM sales in the US.

Four per cent sales rise bolsters GM, while Chrysler’s decline continues unabated

General Motors logo5 Nov 2009

By RON HAMMERTON

GENERAL Motors regained a spring in its step in the United States last month, notching its first year-on-year sales rise in 21 months, while fellow American automotive struggler Chrysler plunged further into the depths with a 30 per cent sales decline compared with October last year.

It was a blow to Chrysler on the eve of its much-hyped five-year recovery plan announcement, underlining the task facing CEO Sergio Marchionne after his arrival with a new broom from new owner Fiat SpA.

With GM sales up four per cent to 177,603 units in October, and cross-town rival Ford also in the black with a three per cent rise, the overall US market managed to eke an honourable draw by achieving 838,233 units – just 216 vehicles short of October 2008’s tally.

The performance was heartening in the absence of US government cash-for-clunkers incentives, which were discontinued a month earlier, prompting fears that the market would resume its downward spiral.

However, the market did not have much to beat in comparisons with last year, as US car sales had already plunged more than 30 per cent to the lowest levels since 1983 last October after the collapse of Lehman Brothers.

 center imageLeft: The Ford Taurus SHO. Below: The Chevrolet Traverse.

Year to date, the US market is still down 25 per cent on last year, and on target for a 12 month total of 10.2 million units, compared with 13.2 million last year and 16.2 million in 2007.

In GM’s case, any sales rise is welcome. The latest figures reflect a strong performance by the revised company’s four core brands – Chevrolet, Buick, GMC and Cadillac. With Saturn, Pontiac and Hummer effectively on the scrap heap, the others seem to be picking up the slack.

GM vice president of US sales, Susan Docherty said those core brands accounted for 95 per cent of GM sales in October, compared with 85 per cent at the same time last year.

“Our sales mix is healthier than it was with eight brands,” she said.

Ms Docherty said GM still had some way to go to earn consumer trust and change perceptions of the company.

“While we are encouraged by consumer acceptance of our new vehicles and our October results, no one is celebrating,” she said.

Led by strong demand for newer models, including Camaro, Equinox and Traverse, Chevrolet delivered 116,436 units in October, up 8.5 per cent on the same month last year.

Cadillac was up 21.6 per cent, Buick up 18.5 per cent and GMC up 20.4 per cent. However, doomed ‘non-core’ brands such as Saturn, Pontiac and Hummer dragged the overall figure down, with a collective decline of 39.6 per cent.

The newly-profitable Ford continued its steady sales performance, bolstered by its image as the only ‘Big Three’ US car-maker to survive the downturn without resorting to government aid and a range of fresh, fuel-efficient products.

The Blue Oval’s October sales tally of 132,483 vehicles was up three per cent on last October’s total and 21 higher than September, and again placed Ford in third place behind GM and Toyota.

The born-again Ford Taurus is leading the way, with sales of the mid-sizer almost tripling last year’s sales levels.

Chrysler tried to put a positive spin on its October performance by trumpeting a six per cent sales increase over September, but the industry standard is to compare the latest figures with the same period last year – a comparison that shows Chrysler’s decline has continued with a 30 per cent fall.

Worse, the fall comes on top of a 35 per cent fall in October last year.

Japanese transplant manufacturers Toyota and Honda remained steady last month, returning almost exactly the same sales figures as the year prior, at 152,165 and 85,502 units respectively.

Nissan did a bit better, up six per cent to 60,115 units. Now, it is breathing down Chrysler’s neck for fifth place.

The big winner again in October was Hyundai, who charged ahead to the tune of 49 per cent, to 31,005 units, in its tenth consecutive year-on-year monthly growth.

Accent, Elantra, Santa Fe and Genesis have all enjoyed big rises this year, with more growth expected with the arrival of the new Tucson and Sonata over the next few months.

Reflecting the Korean brand’s global surge, Hyundai has grown from 3.1 share of the US market in 2008 to 4.3 per cent, marking it as the motor company to watch.

Subaru’s fresh Legacy (Liberty) and Outback range boosted its sales by 41 per cent in October, to 18,169 vehicles.

The biggest losers were Mitsubishi and Suzuki, down 48 and 50 per cent respectively. These two Japanese companies have been relegated to market fringe players in the US, selling just 3867 and 1745 units respectively on the American market last month.

Of the Europeans, Daimler Group, Jaguar Land Rover and Porsche all made gains, but BMW Group was down 19 per cent.

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