GM: Stockpiles grow as sales slump 5.8%
DETROIT -- General Motors’ U.S. sales slumped 5.8 percent in April, and its dealerships now have more inventory waiting to find buyers than at any month since before the recession started almost a decade ago.
GM executives say inventories will decline as the year goes on, with more downtime than usual scheduled to retool for a spate of vehicle redesigns. Inventories have risen for four consecutive months and now sit at more than 935,000 units, a 100-day supply.
At the same time, the company made gains in pricing last month, cutting incentive spending in April by about $750 from the first quarter, while its average transaction price rose more than $600 to $35,000.
GM said its retail sales fell 4.4 percent from April 2016, resulting in a 0.1 percentage point increase in retail market share. Its fleet sales declined 11 percent, including a 20 percent drop in deliveries to rental-car companies.
Chevrolet had the toughest month of GM’s four U.S. brands, posting a 10 percent decline. GMC was down 0.3 percent, despite a 45 percent gain for the Acadia. In contrast, Cadillac sales rose 9.5 percent and Buick sales jumped 17 percent, for its best April since 2005.
GM’s strong crossover lineup saved the company’s month. It sold 16 percent more crossovers than a year ago, with retail crossover sales surging 31 percent.
“We see crossovers becoming an even bigger part of the industry and GM sales over the next five years,” Kurt McNeil, GM’s U.S. vice president of sales operations, said in a statement. “Just five years ago, about one in four GM sales were crossovers. Today, they account for almost one-third of our deliveries and we see more growth ahead.”
In contrast, GM’s car sales dropped 12 percent. Sales fell double digits for all four pickup nameplates. For a second consecutive month, the Chevy Silverado fell behind Fiat Chrysler Automobiles’ Ram pickup. Silverado sales tumbled 20 percent to 40,154, while Ram sales rose 8 percent to 43,321.
GM spokesman Jim Cain said incentives on GM’s pickups fell more than $400 from a year ago, while Ram offered “significantly higher” discounts than GM. He said Ram is unlikely to keep beating the Silverado, which still holds a 6,101-unit lead year-to-date.
“A year has 12 months, and we are not yet into the prime pickup selling season,” Cain said.
The Chevy Cruze was an exception to GM’s gloomy car sales, achieving a 51 percent increase. The Chevy Bolt EV had its best month since its December launch, with sales of 1,292 units across the eight states where it was available in April.
GM officials said inventory remains on track with their plan for the year. The company cut shifts at three car plants in the first quarter to help reduce supplies, while also building up crossover, SUV and pickup supplies in anticipation of third-quarter downtime for several important model changeovers.
GM CFO Chuck Stevens last week said he expects inventory to fall to a 90-day supply by the end of June and about 70 days’ worth by the end of the year.
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