DETROIT - In my May sales blog a year ago, I wrote that Honda Civic sales for the month would top Hummer sales for the entire year. My previous post that day was "Wagoner to Hummer: Go Away." Then-CEO and Chairman Rick Wagoner announced that GM would find a buyer for Hummer -- which seemed improbable even that early in the recession -- or would close it. Tuesday afternoon, GM confirmed a story in The New York Times that it is in talks to sell Hummer to Sichuan Tengzhong Heavy Industrial Machinery Company.
Tengzhong gets Hummer's senior management, including the division's president, Jim Taylor, and GM expects to enter into a long-term contract to sell key components and material supplies, and continues to assemble Hummers for the long-term. Which may not do much for GM's reputation as purveyor of big, thirsty SUVs. That's another post.
That post on June 3 of last year said that American Honda sales rose 11.3-percent for the month. Civics (which posted sales of 52,299, versus Hummer division's 27,485 for all of '08) and Fits were sold out because gas was nearly $4 per gallon. Toyota sales fell 7.9 percent, only because it didn't have enough Priuses to meet demand. General Motors, Ford Motor and Chrysler all were off by fairly large double-digits.
Why is this important today?
Because someone, somewhere, is going to misreport that Toyota, with sales down 38.4 percent, and American Honda, which recorded a 39.2-percent drop, did worse than GM, down just 29.6 percent, and Ford Motor Company, down 24.2 percent. Remember, these are May '09 versus May '08 sales for the U.S. market. Thanks to gas prices last year, the Japanese manufacturers were stronger a year ago than the domestics. They had more space to fall.
That said, there was a lot of optimism about May '09 sales, even at Chrysler, which was off 47 percent. Chrysler's retail sales fell just 30 percent, said sales and marketing VP Steven Landry, to help the company to its best month in 2009 so far. Selling cars during a full month of Chapter 11 bankruptcy proved easier than expected, Chrysler said.
"I don't know of any of our dealers that have had a fire sale," Landry said.
Where bankruptcy was considered a dealer-killer a couple of months ago, Chrysler and GM seem to have moved well beyond that, with even Chrysler claiming a relative uptick in last month's sales. Both companies cited the Obama administration's pledge to back up new car warranties with federal guarantees.
Increased seasonally adjusted rates, both in the U.S. and globally, "indicates that we did find the bottom as an industry in the spring," said Mark LaNeve, GM's vice president for North American sales, service and marketing. He sees "consumers somewhat de-sensitized to bankruptcy. They're moving past it."
According to each of the Detroit Three's calculations, May's Seasonally Adjusted Average Rate was in the 10.1- to 10.2-million range, slightly higher than GM's break-even point assuming it can hold on to 18.5-percent market share with Chevrolet, Buick, GMC and Cadillac. With outgoing Hummer, Saab, Saturn and Pontiac, it held on to 20.5 percent in May. Break it down to the four brands that will survive and its market share was just 16 percent.
That's where better distribution of marketing funding to the four core brands will come in. If GM can redirect Pontiac and Saturn buyers mostly to Chevy, with some going to Buick, it may be able to maintain that crucial 18.5-percent market share.
Total sales of GM's Core Four was 168,623, still ahead of Ford-Mercury-Lincoln's 155,954 and Toyota-Lexus-Scion's 152,583. Chevrolet alone sold 127,510, still below Toyota division's 135,661 and the Ford brand's 137,167.
Ford execs were ecstatic about that company's relative success, its best sales month since last July. They touted reduced sales incentives, even though Ford just launched its "Drive the Ford Difference" promotion, which makes the first three payments for buyers, during the summer. Sounds like a lot of money on the hood, to me.
With that, let's go to the numbers:
GM: 191,875, off 29.6 percent.
- Sales were up 19,000 units, or 11 percent, over April '09 (which was up 11 percent over March)
- Chevy retail sales up 28 percent, Buick retail up 17 percent.
- Toyota Highlander (7,556) and Honda Pilot (7,412) passed Chevy Traverse (7,045). And Ford Flex was up more than 1,100 units at 4,305 to pass Dodge Journey (4,023)..
- Chevy Express/G Sportvan, was GM's best year-over-year performer, up 149.6 percent to 2,194, Cadillac Escalade was second, up 21.3-percent, to 1,831.
- Hummer sold 1,094 trucks, off 40.6 percent, but better than last month's 913. Saab sold 783 vehicles, off 63.5 percent and Saturn sold 8,046 vehicles, off 55.5 percent.
Ford-Lincoln-Mercury: 155,954, off 24.3 percent.
- With lots of new product, it gained market share again and topped Toyota Motor Sales USA by 3,371 units. Last month's lead was 3,358 units.
- F-Series was off 22.3 percent, to 33,381. Toyota Tundra was off 45.2 percent, to 6,414.
Toyota-Scion-Lexus: 152,583, off 38.4 percent.
- Toyota division accounted for 135,661, off 39.0 percent.
- Lexus fell 33.9 percent, to 16,922.
Honda-Acura: 98,344, off 39.2 percent.
- Unlike the competition, its sales fell from April, by about 3,000 units.
- That's 88,875 Hondas, off 39.7 percent, and 9,469 Acuras, off 34 percent.
Chrysler LLC: 79,010, off 47 percent.
- Chrysler Sebring was 1,977, off 72 percent.
- Town & Country fell 38 percent to 7,972.
- Jeep Compass dropped 70 percent to 936.
- Dodge Caliber was off 77 percent, to 2,991.
- 2,695 Challengers sold.