General Motors and the Chrysler group saw both sides of the employee-pricing coin in June.
GM felt the effects of being without it. And the Chrysler group proved how badly it needs those heavy discounts, which it began offering July 1.
U.S. sales of cars and light trucks totaled 1,500,837 in June, down 10.5 percent from June 2005. The first six months totaled 8,375,314, 2.4 percent short of the midyear total in 2005.
The first-half loss wasn't shared evenly. The traditional Big 3 lost 398,488 sales; import-badged vehicles gained 196,657. While GM, the Chrysler group and Ford Motor Co. slumped, Toyota Motor Sales continued to rock and roll, up 9.8 percent for six months.
Meanwhile, industrywide sales of trucks -- especially pickups and SUVs -- took a bath, thanks mostly to $3-a-gallon gasoline. Both segments were down 27.7 percent from last year.
Here are a few topics on our minds regarding last month's sales.
What was behind GM's June swoon?
In June 2005, GM's domestic brands began offering an employee- pricing incentive, and its sales soared. The total of 404,218 North American vehicles GM sold this June was down 25.7 percent from last year. But it was a bad month for GM even when compared with other recent Junes. GM's 2001-05 average for June sales was 447,585.
Five of GM's seven domestic brands lost ground last month, ranging from 16.2 percent for Hummer to 47.3 percent for GMC. Saturn was up a fraction, but Pontiac, up 12.1 percent, was the only bright spot.
But Pontiac partisans should not throw their hats in the air. Last June, despite employee pricing, Pontiac was the only GM make that managed to sell fewer new vehicles than in 2004. It was down 14.1 percent.
Why did the Chrysler group need employee pricing?
Because it is awash in unsold new vehicles -- 647,700 of them as of July 1. That was 55,200 more than a month earlier.
And the Chrysler group's truck supply is frightening: 510,600, or 78.8 percent of the group's total inventory. That is 43,300 more trucks than on June 1, when trucks made up 78.9 percent of the group's total inventory. In June, 72.4 percent of the Chrysler group's sales were trucks.
Chrysler group sales were down 15.5 percent in June.
What happened to truck sales in June?
Sales of both pickups and SUVs were down 27.7 percent from a year ago. Big pickups suffered, down 29.3 percent for the month. The Ford F series and Chevy Silverado are in that group.
The bigger the SUV, the bigger the sales plunge. Mid-sized models such as the Ford Explorer and Chevy TrailBlazer were down 27.8 percent in June; the big jobs (Chevy Suburban and Tahoe, Ford Expedition) dived 43.4 percent. Smaller SUVs such as the Ford Escape fared best, up 9.5 percent.
The high price of gasoline hit big pickups and SUVs hard in June. Sales of full-sized pickups were down only 9.8 percent for the year, and SUV sales were off only 12.3 percent.
Despite their poor June sales, GM and Ford reported gains in market share compared with May. What gives?
My favorite college professor used to say there are three kinds of liars -- liars, damned liars and statisticians. In this case, blame the third group.
May sales of GM's domestic brands were absolutely dreadful. June sales, though far below June 2005, were 20.5 percent higher than in May.
Total U.S. sales in June were only 0.7 percent higher than in May. So GM outperformed the market; when you outperform the market, your share goes up. In GM's case, its domestic brands rose from 22.5 percent in May to 26.9 percent in June.
Market share for Ford Motor's domestic brands in June was an anemic 16.7 percent, but it was better than its 16.1 percent in June 2005. Ford's June sales were down 7.0 percent; the overall market was down 10.5 percent, so Ford outperformed the market in June.
Nissan Division seems to be stumbling lately. How did it do in June?
Not so well. Sales were down 18.9 percent for June and down 4.7 percent for the first half. In June, Nissan's car sales dove 25.3 percent from last year, and its truck sales declined 11.9 percent. Big losers on the car side in June were the Altima, off 36.3 percent, and the Sentra, down 21.3 percent. They are Nissan's best-sellers.
Was it yet another big month for Toyota?
Indeed. Everything's still coming up roses. Toyota Motor Sales U.S.A. (Toyota-Lexus-Scion) was up 14.4 percent for June and 9.8 percent for the first half. Toyota Division led the industry in car sales for the month and for the year so far, and Toyota Motor Sales is a mile ahead of the Chrysler group for third place in the industry in total vehicle sales.
In June, Toyota Motor Sales outsold the Chrysler group for the fourth month in a row and had a lead of 93,996 for the first six months.
You may e-mail John K. Teahen Jr. at [email protected]