GM's sales drop 8% as fleet sales fall
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GM's sales to businesses, rental companies, governments and other fleet customers sank 25 percent from April of last year. |
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DETROIT -- General Motors' U.S. sales in April dropped 8 percent, partly from a decline in fleet sales, leaving GM's market share so far this year below its 2011 levels.
GM sold 213,387 light vehicles in April, giving the company a market share of 17.7 percent for the first four months of the year, down from 19.6 percent in the same period last year and from 18.8 percent at the end of 2011.
GM said its retail sales in April were flat from a year earlier. Executives pointed out that the results reflect three fewer selling days than in April 2011.
GM executives consistently have said that they won't sacrifice profits by chasing market share, and that they will match production with demand. GM's April incentives rose 3 percent from a year earlier vs. a 6 percent average gain for the eight largest automakers, according to TrueCar.com.
Taking the long view
Asked whether GM is losing business to competitors such as Toyota Motor Corp. and Chrysler Group, which both reported higher sales, GM U.S. sales chief Don Johnson acknowledged that Toyota and other Japanese rivals are rejuvenated after their production was sharply curtailed last year because of the March 2011 earthquake and tsunami.
"You have to look at it on a longer-term trend," Johnson said during a conference call with analysts and reporters.
"There's no doubt the Japanese are back in the market," he said. "They have a high inventory. They're being particularly aggressive in the fleet business. But we're going to maintain our competitiveness in the market."
Pickup sales were GM's bright spot. They rose 7 percent on the strength of a 9 percent increase in combined sales of the Chevrolet Silverado and GMC Sierra full-sized pickups.
Cars down
Car sales fell 18 percent, including a 20 percent drop in Buick LaCrosse sales and a 28 percent decline in sales of the Chevrolet Cruze compact, which has been GM's top-selling car over the past year.
Sales of crossovers were down 8 percent, as stronger sales of the Chevrolet Equinox and GMC Terrain were offset by the phasing out of the Chevrolet HHR wagon.
The GMC brand, with a 5 percent gain, was the only one of GM's four brands to increase sales.
Chevrolet sales dropped 8 percent, to 155,487. GM executives blamed the drop in Cruze sales partly on a smaller portion of sales going to fleets.
Alan Batey, vice president of sales and service for Chevrolet, said he's pleased with continued strength in Cruze pricing. The car's average transaction price for the month through April 20 was $19,572, compared with $16,917 for the Toyota Corolla, Batey said, citing data from J.D. Power and Associates.
Not discounting
"We're not getting drawn into a discounted sales position," Batey said on the conference call. "We're driving great sales with great retail penetration."
A bright spot for Chevrolet was sales of the Sonic subcompact, which launched last August as a new nameplate to replace the Aveo. GM sold 6,387 Sonics in April, 38 percent higher than year-earlier Aveo sales and 24 percent more than April sales of the Ford Fiesta, a key competitor.
Cadillac and Buick posted a seventh straight month of declining sales compared with year-earlier levels. Buick sales fell 16 percent while Cadillac sales dropped 25 percent.
Falling fleets
Executives at both brands point to sharp drops in fleet sales. Buick's fleet sales, for example, fell 71 percent in April. Still, both brands' sales to individual buyers dropped too: Buick's retail sales sank 4 percent from a year earlier while Cadillac's fell 11 percent.
Overall, GM's sales to businesses, rental companies, governments and other fleet customers sank 25 percent from April of last year, GM said. A decline in deliveries to rental companies represented the bulk of the drop.
Fleet sales represented 27 percent of GM's total sales for the month.
You can reach Mike Colias at mcolias@crain.com.
