GM's sales down, Chrysler's up Industry is looking at gain for all of 1996, fooling the experts

THE BALTIMORE SUN

AUBURN HILLS, Mich. -- General Motors Corp. yesterday reported another car and truck sales decline in December, while Chrysler Corp. continued to gain amid a stronger than expected U.S. auto industry sales year.

Chrysler, which eked out a 1 percent gain for the month, was the year's strongest performer among U.S. major automakers, beating the sales record it set in 1988.

The gains reflect the popularity of the No. 3 automaker's pickups, minivans and Jeep sport-utility vehicles, combined with aggressive rebating to maintain demand for cars. They also reflect strength in the U.S. economy, which combines low inflation, steady income gains and low unemployment.

Full-year industry sales won't be known until next week, when Ford Motor Co. and other companies report. The final volume is expected to be about 15.0 million cars and light trucks, about 2 percent above the 14.7 million of 1995.

"Most forecasters got fooled -- the market turned out to be much better than anybody anticipated," said Joseph Phillippi, a Lehman Brothers analyst.

For Japanese automakers, the year was mixed. Toyota Motor Corp. sales gained 6.4 percent in 1996. Mitsubishi Motors Corp. full-year sales fell 6 percent. Honda Motor Co. rose 6.9 percent through November, compared with the year-earlier period, while Nissan Motor Co. declined 3.6 percent in the same period. Neither Nissan nor Honda has reported December sales yet.

For GM, the largest U.S. automaker, December capped a string of disappointing sales reports. The automaker said car and truck sales fell 14 percent to 343,513 for the month, about what analysts expected.

The company has been struggling to produce enough full-size pickups and sport-utility vehicles. It also was hindered by strikes that cut truck production this fall in the United States and Canada. It's also changing over eight plants to build new models, most of which aren't yet available in showrooms.

"What's hard to sort out is how much of it is strike-related, how much is launch-related, and how much is products that are missing the mark," Phillippi said.

For the full year, GM's sales declined about 2.8 percent, with car sales down 6.5 percent and truck sales up 3.3 percent.

Chrysler's full-year U.S. sales rose 13 percent from the year earlier. Chrysler's U.S. market share rose to 16.2 percent from 14.6 percent during the same period.

Ford is expected to report a sales gain of up to 9 percent when it announces its December sales Monday.

Through November, Ford sales are down 0.3 percent.

Industrywide, "it was a pretty good year," said Michael Schmall, an auto industry consultant with JD Power and Associates, which is predicting a slight decline in 1997 sales, to 14.9 million.

Chrysler shares rose 50 cents to $34.625 yesterday. GM shares fell 62.5 cents $57.875.

Pub Date: 1/04/97

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