An improving housing market and a lack of serious concern over Washington's latest fiscal fight drove sales increases in February for the major automakers.
General Motors' sales rose 7% from a year earlier, while Ford reported a 9% increase. Chrysler's February sales edged up 4% after speculation that the company's U.S. sales might break a streak of 34 straight months of sales increases.
Toyota sales rose 4.3%, Nissan sales fell 7% and Volkswagen rose 3%.
Despite gasoline prices nearing $4, full-size pickup trucks flourished last month as rising housing prices prompted more small businesses to buy vehicles.
Sales of Ford's F-Series, the most popular vehicle in the country, rose 15% to 54,489 units. GM's Chevrolet Silverado pickup truck rose 29% to 41,643 units, and the GMC Sierra rose 25% to 14,133 as GM sells 2013 models to make way for its redesigned 2014 pickups in the second quarter. Chrysler's Ram truck edged up 3% to 23,289.
"The recovery in home prices is building customer confidence, credit is available and affordable and consumers appear to be taking higher payroll taxes in stride, at least when it comes to replacing older vehicles," said Kurt McNeil, GM's vice president for U.S. sales operations, in a conference call.
The full-size pickup segment in February accounted for 12.3% of the industry, up from 12.1% in January and a huge increase from 10.7% a year ago, said Erich Merkle, Ford's U.S. sales analyst.
Ken Czubay, Ford vice president for U.S. sales, marketing and service, said he expects pickups will keep their larger share of the market, especially with improved housing and construction, which have an "incredible correlation" to truck sales.
The strong truck sales contrasted with pockets of weak sales for small and mid-size cars. Although Chevrolet sales rose 5% for the month, they would have fallen 1% without the Silverado's increase. The Chevy Malibu dropped 26%, Cruze fell 12% and Sonic slipped 24%.
At Nissan, the mid-size Altima fell 16%. Last year at this time Nissan was selling a higher volume of Altimas than normal as it cleared out inventory and prepared to launch a redesigned model.
Toyota reported a 9.5% decrease in sales for the mid-size Camry to 31,270, while sales of the Prius family of vehicles fell 13.5% to 17,812.
On the other hand, Chrysler sold 7,720 units of its new Dodge Dart compact, and Ford recorded a 28% increase for the Fusion sedan to 27,785 units.
Honda's 107,987 vehicles sold in February constituted a 2% decrease from a year ago. The Honda brand was down by 2.3% despite strong Accord sales while the luxury Acura brand was up 0.9%.
"It took a big winter storm in the Northeast to slow us down a bit, but our robust sales over the last three weeks show that our strong retail momentum continues," said John Mendel, executive vice president of Sales at American Honda. "With Accord posting strong numbers and spring just around the corner, the best is yet to come."
Hyundai set a new February record with sales of 52,311 units, up 2% from a year ago, on strong sales of the Santa Fe Sport and Elantra and boosted by heavy advertising during the Super Bowl and Academy Awards.
"February was another record month for Hyundai -- we had a terrific President's Day weekend event to kick off the spring selling season, much improved inventory levels, and great access to credit available to a broader band of buyers," said Dave Zuchowski, executive vice president of sales.
At Kia, February sales of 41,505 were below year-ago's 45,038 with Optima the only vehicle to see a sales increase. The falloff follows record sales and market share in 2012. But Kia has a busy year ahead with seven new vehicles to launch including three world introductions planned for the New York auto show later this month.
Generally, high gas prices empower small vehicle sales. But GM's McNeil said the company believes gas prices will fall as temporary refinery troubles subside.
Economists are watching closely to see whether consumers halt spending because of automatic spending cuts triggered by Washington's sequestration crisis.
But Ford Chief Economist Ellen Hughes-Cromwick said the effect of a 2% increase in payroll taxes and sequestration may be more than offset by other economic factors. Those include higher consumer confidence, low interest rates and plenty of available financing, strong housing starts and aging vehicles that people need to replace.
Chrysler and Fiat CEO Sergio Marchionne told reporters Thursday in Kokomo, Ind., that he's not worried about sequestration.
"I have the ultimate faith in the ability of the political system to resolve the issue," Marchionne said. "I understand that a lot of this is part of a ritual that needs to be concluded. For me to express a view beyond that ritual would be nonsensical."
Analysts are predicting that overall industry sales increased somewhere between 2.4% and 5.7% in February, buoyed by an increased demand for pickups and the strength of the U.S. economy.
Chrysler's results were boosted by the performance of its Dodge brand, which reported a 30% sales gain and sold 7,720 Dart compact cars -- the most since it was launched last summer. However, Jeep brand sales fell 16%, Chrysler brand sales fell 7%. Sales for both the Ram and Fiat brands increased 2%.
Ford's luxury Lincoln brand, which the company is trying to revive, continues to struggle, with sales down 29%. The new MKZ is undergoing a slow ramp-up with full inventories to dealers still a month away.
To sustain momentum, the automaker announced it will increase overall vehicle production in the second quarter by 800,000 vehicles or 9% more than a year ago.
All four of GM's brands achieved sales increases for the month, with Chevrolet up 5%, Cadillac up 20%, Buick up 15% and GMC up 10%.
But sales of GM's passenger cars fell 4% as the company struggles with what executives have described as the oldest vehicle portfolio in the industry.
Still, GM's freshest products came on strong. The company sold 3,382 units of the Cadillac ATS in the month after the vehicle's victory in the North American Car of the Year competition, outpacing the Cadillac CTS at 2,566 units. GM plans to unveil a redesigned version of the CTS later this month.
"All signs of the industry's health are positive right now," John Humphrey, senior vice president of the global automotive practice at J.D. Power and Associates said in a recent report. "Average transaction prices are up, incentives are stable, leasing is at a healthy level and newly redesigned models continue to make an impact on the marketplace."
(c)2013 the Detroit Free Press
Visit the Detroit Free Press at www.freep.com
Distributed by MCT Information Services
Most Popular Stories
- #myNYPD Twitter Campaign Backfires for NYPD
- Pols Back Away From Bundy After Racist Statements
- First-time Jobless Claims Jump by 24,000
- Putin Says Internet Is CIA Plot
- Durable Goods Orders Rose More Than Expected
- Freshman Senators Speak Out on Foreign Policy
- Nasdaq OMX Profits Soar in Q1
- John Oliver Set for 'Last Week Tonight'
- Justin Bieber's War Shrine Pic Causes Flap
- Sina Loses License Over Porn