U.S. Auto Sales Finish Year Strong
By JEFF BENNETT
Auto makers capped 2011 with a strong December and forecast the recovery in U.S. sales would intensify as long as a stabilizing economy and improved U.S. job gains continue to encourage shoppers.
Detroit auto makers reported increases in vehicle sales for December, with Chrysler Group LLC posting a 37% rise, Ford Motor Co. citing a 10% gain and General Motors Co. reporting a 4.6% increase. For the full year, Chrysler's sales rose 26%, Ford's 11% and GM's 13%.
All told, auto makers sold 1.2 million cars and light trucks in December, a rise of 8.7% from the same month in 2010, according to Autodata Corp. Light vehicles sales for all of 2011 totaled 12.8 million, Autodata said, an increase of 10.3% from 2010.
The annualized sales pace in December was 13.56 million vehicles, the second highest of 2011. It also marked the fourth consecutive month in which the sales pace topped 13 million, a positive sign for 2012.
Toyota Motor Corp. and Honda Motor Co. suffered one of the biggest setbacks in the U.S. in 30 years as both companies reported drops in annual sales after they were unable to shake off the production and distribution disruptions caused by the March earthquake in Japan and later by flooding at plants in Thailand.
Toyota's December sales rose less than 1% to 178,131 vehicles as purchases of most of its models declined. Sales of the redesigned Camry sedan had modest gains, keeping it s place as the best-selling car in the U.S. for the year with 308,510 sales. For the year, Toyota sales overall declined 6.7%, to 1.64 million. Honda was the only major auto maker to report a decrease in December as its sales dropped 19% to 105,230. Its annual sales also tumbled 7.1% to 1.15 million.
The stumble of the Japanese auto makers created an opening for the Detroit Three to win back market share by introducing newer designs and models, especially in the midsize and small car markets. Ford will introduce an updated Fusion sedan while Chrysler will return to the small car market with the Dodge Dart. Ford and Chrysler will show off these vehicles at the North American International Auto Show in Detroit next week.
Toyota and Honda are responding with plans to freshen some of the models in their vehicle portfolio. Honda will upgrade its Civic this year after poor reviews of the current model.
GM and Ford each said they expect auto sales to reach at least 13.5 million vehicles in 2012, based on a strengthening U.S. economy.
"Over the course of the fourth quarter, clear signs emerged that U.S. consumers are more confident," GM's vice president for U.S. sales operations, Don Johnson, said on Wednesday. He added that at least 100,000 auto-related jobs have been created in each of the past five months. "That's the longest stretch since 2006," he said.
Sales of the Chevrolet Cruze compact car increased 54%, while sales of the Camaro sports car rose 20%. GM's Chevrolet Volt battery-powered car sold 1,529 units, making December its best month. Overall, Chevrolet-brand car and truck sales rose 8.9% last month while sales of Cadillac, Buick and GMC brands declined from a year earlier.
Shares in GM, which is partially owned by the U.S. government, rose 10 cents apiece to $21.15 in 4 p.m. New York Stock Exchange trading. Shares are down 45% in the past 12 months.
Ford said it expects the U.S. economy to expand by between 2% and 3% this year and forecast 2012 auto sales in the range of 13.5 million to 14.5 million.
"The momentum coming out of the fourth quarter of last year provides some confidence that the lower end is less likely," Ford economist Ellen Hughes-Cromwick said during a conference call on Wednesday "At the same time, we are well aware of how the business environment can change quickly. We need to see a follow through in the job market and better job creation, which will only feed into better confidence about the economy."
The European economy, Ms. Hughes-Cromwick warned, might be soft next year, with weak to little growth in some countries. Europe economy continues to show signs of weakness as governments in a variety of countries attempt to contain the debt crisis and stem rising unemployment. There were also fresh worries Wednesday after Italy's largest bank, UniCredit SpA, offered to sell ?7.5 billion ($9.8 billion) shares at a bigger than expected discount in order to generate cash.
"Europe economies are tracking at several different speeds," Ms. Hughes-Cromwick said. "We expect weak growth in the euro area, but some markets will do better than those peripheral countries undertaking fiscal austerity programs this year."
Ford shares were up 1.5% at $11.30 in 4 p.m. New York Stock Exchange trading.
Chrysler's U.S. auto sales rose 37% in December compared with the same period a year earlier as the auto maker sold 138,019 vehicles. Truck sales rose 19% from a year earlier, while car sales more than doubled. The auto maker's namesake Chrysler brand reported an 83% increase fueled by the introduction of the Chrysler 200, which replaced the Sebring, and the refreshed Chrysler 300.
For the full year, Chrysler sold 1.37 million cars and trucks in the U.S. The auto maker didn't provide a 2012 forecast.
Ford sold 209,447 cars and light trucks in December, and 2.14 million in all of 2011. GM's December sales totaled 234,351 vehicles; it sold a total of 2.5 million in 2011.
South Korea's Hyundai Motor Co. posted a 13% U.S. gain in December to 50,765 vehicles, driven by demand for its Sonata and Elantra models. For the year, its sales rose 20%, to 645,691 vehicles. Affiliate Kia Motors Corp. said its December U.S. sales rose 43%.
Nissan Motor Co. said its sales rose 7.7% to 100,927. The Japanese auto maker's annual sales rose 14.7% to 1 million, its third-highest total in the U.S. as Nissan largely avoided supply disruptions caused by the Japanese earthquake and tsunami.
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