More evidence Thursday poured in showing that in the midst of the consumer recovery in the U.S., people are buying cars. Major auto makers reported November sales that were broadly over expectations on Thursday, and retail customers, not fleet-purchasers like rental companies, are the big buyers.
Chrysler Group, Ford and GM all reported stronger demand for their cars in the second-to-last month of the year. Analysts’ outlooks for the American automakers are hinged on accelerating sales that are picking up momentum since sales dropped off after the government's "Cash For Clunkers" program in 2009 ended.
Ford reported a sales gain of 13% in November, beating the analyst consensus for 10%. Retail sales, or sales of cars to individual customers, surged 20%, the fastest gain in nine months. The company sold more utility vehicles and trucks than the same month a year ago, and it reported a marked increase in the Ford Fiesta. Sales of the fuel-hybrid Fusion increased 15%.
“The industry sales rate has exceeded 13 million in each of the last three months,” said Vice President of Ford marketing, sales and service Ken Czubay. “This suggests the current momentum is not an aberration. We believe replacement demand will continue to support stronger levels in 2012, and Ford is ready to meet that demand.”
Ford’s success in pricing may have been a factor in its sales jump, says Citi auto analyst Italy Michaeli. The company says it gained market share in the last three months, to about 15% of retail auto sales in the U.S. The company also revised its fourth-quarter production forecast for North America to 674,000 vehicles, a 2% increase.
Truck sales were a common strand in the sales reports from American automakers GM and Chrysler as well. Chrysler, the smallest of the three Detroit automakers, reported a 45% increase in U.S. sales, helped by its Jeep and Dodge brands. Sales of the company’s name-brand nearly doubled to 18,577 units.
GM said that sales increased 7%, pushed by sales of its big trucks as well as smaller models, as a “broad spectrum of customers return to the market,” according to GM’s head of U.S. sales operations Don Johnson. Sales of GM's Chevy Silverado increased 34%, while the GMC Sierra rose 22%.
There were declines in auto brands too, which highlight the difficulty that companies continue to face in marketing some types of cars and trucks. At GM, sales in its Buick and Cadillac brands fell 7.2% and 5.6% respectively for the month. Ford ended the production of its Mercury brand in the last quarter of 2010.
Ford shares were flat Thursday at $10.65 and shares in General Motors were down 1.4% to $20.99, down 38% from the relaunch of its IPO last November.
