GM, Ford share slide continues, but companies see silver linings

March was a pretty fair month for U.S. sales of cars and light trucks, but don't try to peddle that line to General Motors or Ford Motor Co.

The total was 1,530,909, down 2.9 percent from March 2005. But any month that tops 1.5 million is a good one. The seasonally adjusted annual rate was 16.8 million, which was right in the ballpark of actual sales in recent years.

But at GM and Ford, things looked less cheery. Sales of Ford's North American brands were down 4.7 percent in March, and GM's plunged 14.6 percent. GM's market share for those brands was 23.3 percent, the lowest since August 1998, when a UAW strike put GM out of business.

The last time GM's full-year market penetration was below 23.3 percent was 1925, when it was 19.1 percent. In those days, Ford's Model T had 36.5 percent of the market all by itself.

In March, GM lost 3.2 percentage points of market share from March 2005; Ford lost about a third of a percentage point. The Chrysler group gained a little more than half a point. The net loss was 2.9 points for the three makers.

Where did that share go? The Japanese picked up 1.7 points. European brands added nearly a full point and the Koreans picked up about a third of a percentage point.

On the import-brand side, American Honda Motor Co. (Honda-Acura) had a record March, and Toyota Motor Sales U.S.A. Inc. (Toyota-Scion-Lexus) was up 6.9 percent over last year. In all, import-badged brands had 44.8 percent of March sales, leaving 55.2 percent for the traditional Big 3. A year ago, the imports had 41.9 percent.

Positive spin

George Pipas and Paul Ballew, Ford's and GM's top sales analysts, looked on the brighter side.

Ballew said GM's 14.6 percent decline in March "is consistent with GM's restructuring plan that calls for us to back off daily rental sales" and stress retail.

"Are we stabilizing our (annual) retail selling rate?" he asked rhetorically. "The good news in March is that we were running about 3 million units (retail), and that's up from last fall."

Ballew also said that GM's average transaction prices are about $1,600 per vehicle higher in the first quarter this year than in the year-ago quarter.

Pipas said Ford is making progress in stemming its market share loss. Ford's North American brands lost 0.6 of a point in the first quarter, down from 0.9 points in the same period last year.

"It's a challenging, daunting task, given the increased number of dealers representing foreign manufacturers and the expansion of their product lines," Pipas said. "And look out over your shoulder. Here comes China."

Apparently, Ford dealers were ticked off by Chevrolet's sales victory in 2005 after Ford had led for 18 years. The Ford brand thrashed Chevy in March, winning the sales race by 22,834 units. For three months, Ford led by 46,085. Chevy is 13,579 cars ahead of Ford so far this year, but Ford dominates truck sales with an edge of 59,664.

Big pickup wars

In March, the Ford brand weathered a tough incentive fight led by Dodge in the big pickup segment. Dodge offered $2,000 to $3,000 to buyers of 2006 Ram pickups. In addition, the dealer incentive was $1,000 to $6,000.

Customer rebates on the 2006 Ford F-series pickups were $2,000 to $2,500, and the 2006 Chevrolet Silverado and GMC Sierra paid $1,500 to $2,500. There also was a $500 giveback on the Silverado and Sierra 2500/3500 models with the LBZ turbodiesel V-8. No dealer incentives were listed on the GM and Ford pickups.

The incentives helped Ford and Dodge more than GM. Ram sales were up 8.9 percent in March, and Ford's F series advanced 4.5 percent for the month and 5.5 percent for the first quarter.

Pipas said F-series retail sales have been strong and so have fleet sales because of a good business climate and post-hurricane rebuilding work in the Gulf states.

In March, sales of the Silverado were down 14.9 percent, and the Sierra was off 13.3 percent. The Silverado and Sierra are reaching the end of the line. They will be new for 2007.

In April, Ford is offering cash incentives of $2,000 to $3,000 or financing rates of 0 to 7.9 percent on 2006 F-series pickups. On the 2006 Ram, the buyer givebacks have risen to $3,000 to $4,000, and the dealer rebates are the same as in March. On the Silverado and Sierra, the customer rebate has grown to $2,000 to $3,500.

You may e-mail John K. Teahen Jr. at [email protected]