News Column

Auto Sales Start the Year Strong

Feb. 2, 2013

Alisa Priddle

january, Auto Sales

DETROIT - Easier credit and modest job growth drove U.S. vehicles sales to a solid pace in January, as Toyota and Ford posted particularly strong increases from a year earlier.

The month's annual selling rate came in at 15.3 million vehicles, the third consecutive month above 15 million. Last year Americans bought 14.5 million new cars and trucks.

"January is off to an amazing start, and this momentum will carry forward through the rest of the year, with auto sales expected to reach 15.5 million units," said Jesse Toprak, senior analyst for TrueCar.com.

Ford's sales rose 22 percent from a year earlier. Chrysler and GM both posted 16 percent increases, while Toyota's sales exceeded their January 2012 level by 27 percent.

All three Detroit automakers and their major competitors posted solid gains in January as pent-up demand, low interest rates and strategic discounting pulled a steady flow of consumers to showrooms.

Incentives are being used prudently and consumers are opting for well-equipped models, meaning automakers are making money on most sales.

General Motors and Ford both said Friday that they are selling vehicles for $1,000 more on average than a year ago, which provides the profits needed to keep investing in new cars, plants and jobs.

The consensus is for 2013 sales of between 15 million and 15.5 million. North America will continue to be a bright spot while Europe grapples with overcapacity, high unemployment and recession.

In the U.S., many automakers reported their best January sales in at least five years. For Volkswagen, it is the best start to the year since 1974.

Toyota finished only about 9,000 vehicles behind Ford and put the Dearborn, Mich., automaker on notice that it will challenge for the nation's second-largest market share.

"It's been three years since Toyota safety recalls seriously threatened its brand, but now sales are very strong and don't look to be slowing," said Jessica Caldwell, senior analyst with Edmunds.com. "Incentives are low, the portfolio is rich with new product, and consumer consideration numbers are high for Toyota."

GM still holds the top spot. Sales of 194,699 were up 16 percent, helped by a strong month for the current Chevrolet Silverado and GMC Sierra pickup.

But GM has built up a 117-day supply of pickup and will take 10 weeks of downtime in the next nine months to retool three plants in Flint, Mich.; Fort Wayne, Ind.; and Mexico for redesigned pickups, said spokesman Jim Cain.

Chevrolet sales ticked up 11 percent while sales at Cadillac jumped 47 percent, Buick increased 32 percent and GMC rose 23 percent.

Officials said they are also benefiting from buzz generated last month at the North American International Auto Show, where GM revealed the all-new Chevrolet Corvette Stingray and Cadillac ELR.

Ford reported sales of 166,501 vehicles last month - a 22 percent increase with gains across the lineup except for Lincoln, were sales fell 18 percent from a year ago. The launch of a new MKZ is slow because of extra quality assurance measures, said Ken Czubay, head of Ford U.S. marketing, sales and service.

"Ford is off to a strong start this year, with Fusion and Escape delivering January sales records and F-Series seeing a particularly strong reception this early in the year," Czubay said.

Fusion sales were up 65 percent from January 2012. F-series pickups were up 22 percent as truck sales are spurred by a modest recovery in the housing market..

Chrysler continues to roar back with sales of 117,731, up 16 percent, for its best January in five years.

Sales increased 37 percent for its Dodge brand, 31 percent for Fiat, 18 percent for Chrysler, 14 percent for Ram, while Jeep sales fell 4 percent.

Chrysler CEO Sergio Marchionne warned Jeep sales could decline in the first half with the end of Liberty production and a gradual launch of its replacement.

"Entering 2013, our product portfolio has never been stronger," said Reid Bigland, Chrysler's head of U.S. sales and CEO of the Dodge brand.

Nissan's sales rose 2 percent, helped by a 202 percent increase for the new 2013 Pathfinder.

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Source: (c)2013 Detroit Free Press Distributed by Mclatchy-Tribune News Service.


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