It's probably too early for General Motors CEO Rick Wagoner to break out the Dom Perignon, but the "GM Employee Discount for Everyone" spiff just might be working.
There was a little excitement on Wednesday when Deutsche Bank analyst Rod Lache reported that his conversations with GM dealers showed June looking like a strong month, with some dealers reporting better than 20 percent gains over last June.
Before we get too excited, don't forget that GM is building on a smaller base. GM dealerships sold 374,970 cars and trucks last June, about 12 percent fewer than the 425,975 they moved in June 2003, so a 20 percent gain this month would push the total to about 450,000. That's about 7,000 more than the 10-year June average, a clear step in the right direction.
And there is corroboration.
Based on five selling days of data collected through the Power Information Network, double-digit growth in retail deliveries seems possible for GM, says Jeff Schuster, executive director of global forecasting for J.D. Power and Associates.
Even so, don't expect GM's month-end numbers to show anything like a 20 percent gain. A one-month spike wouldn't help build momentum or show steady sales growth, Shuster says. So a surge in retail deliveries could prompt GM to defer some fleet sales until July or August as a way of redistributing the wealth and build sales momentum.
The big question is: Where are the gains coming from? So far, they're mostly coming from Ford and Chrysler.
In the first five days of June, 13.8 percent of GM buyers traded in a Ford brand, up from 12.3 percent in May. And 10.5 percent traded a Chrysler brand, up from 10.1 percent last month.
What does it all mean?
Coupled with the cuts in North American production, GM can slash its stock of nearly 1.2 million unsold cars and trucks this summer.
While that's hardly rock-hard proof of a miraculous recovery, it sure beats a poke in the eye with a sharp stick.
And GM has been ducking lots of sharp sticks lately.
You may e-mail Edward Lapham at