Don’t miss Orioles players, John Means & Paul Fry, as they guest host at our Brews and O’s event!

Ford and GM lose ground again

THE BALTIMORE SUN

General Motors and Ford took another hit from slumping sales of large sport utility vehicles in April, and the two largest automakers again lost ground to major Asian rivals.

GM's sales fell 4 percent and Ford's nearly 2 percent for the month. Large SUVs, a principal source of profits for both, are down about 15 percent this year.

"There's not much GM and Ford can do to correct their product offerings short term," said Peter Morici, a University of Maryland, College Park business professor. "They're married to large vehicles and big engines, and consumers just aren't buying them right now."

Toyota's best month

Toyota Motor Sales U.S.A. had its best month ever, selling 210,466 Toyota, Lexus and Scion vehicles. That's 26 percent more than a year earlier.

Toyota also sold 11,345 of its gas-electric Prius cars last month, more than tripling the year-ago tally of 3,684.

Honda Motor Co., also a leader in hybrid technology, also mentioned demand for fuel efficiency as a key factor in sales last month. Its overall business was up 13.6 percent, including a 19.2 percent increase in trucks and a 10.2 percent increase in cars.

Toyota's market share increased to 14 percent for the month, 2 percentage points higher than a year earlier. GM's share was 25.3 percent, 2.5 points lower than a year earlier, and Ford's was 18.6, down from 20 percent last April.

Nissan North America's sales gained 32 percent, to 91,621 vehicles.

The Chrysler Group was the lone bright spot among domestics, with a 9 percent increase. That marked its 13th-straight month of higher sales. Chrysler sold 206,546 vehicles amid strong demand for the Chrysler 300 sedan, minivans and the Jeep Grand Cherokee.

Including Dodge and Jeep brands, Chrysler is up 7 percent for the year, to 753,278. Toyota's sales are up nearly 14 percent, to 717,702.

Chrysler and the major Asian brands lifted industry sales to 1.5 million vehicles for the month, nearly 6 percent more than a year earlier, perhaps the strongest April on record.

That didn't stop the bleeding at GM and Ford, which have lowered earnings forecasts on sluggish demand for SUVs.

GM lost $1.1 billion in the first quarter, mainly on SUV sales. In April, the full-size Chevrolet Tahoe was down 34 percent and the Suburban 30 percent.

GM's truck sales dipped 14 percent, offsetting an 11 percent gain in passenger-car sales. GM sold 380,535 vehicles for the month. Its sales this year are down 5 percent, to 1.38 million vehicles.

Paul Ballew, GM's market analyst, called the SUV sales "a little softer than what we anticipated" and blamed the decline more on the age of the vehicles than high gasoline prices.

GM plans to roll out new versions of its large SUVs early next year, and it is banking on them.

But "with high gas prices, SUV sales are going to continue to lag," Morici said. "GM is almost in denial on that issue."

GM is reducing its second-quarter production by 10 percent, to 1.25 million vehicles, and trimming the number of SUVs, so it doesn't have excess inventory of old models.

The SUV slump also offset increases among passenger cars at Ford, resulting in its 11th straight month of year-to-year decline. The Explorer SUV was off 15 percent for the month, and the Expedition fell 20 percent.

Ford car sales up

Ford's car sales are up 1 percent this year. Mustang sales grew 26 percent in April, to 19,559, and the Five Hundred sedan had its best month since its launch last fall, selling 9,215.

George Pipas, Ford's sales analyst, said SUV results would be lower if it hadn't boosted sales to daily rental companies such as Hertz, a Ford unit.

Ford lowered its second-quarter production forecast April 20 by 5 percent, to 905,000 vehicles, and Pipas said SUVs would account for a large portion of the cut. Explorer production is being trimmed because a redesigned model is due in the fall.

Though Ford says gas prices have dented sales of the large, truck-based SUVs, Pipas said the growing number of car-based "crossover" SUVs such as the Ford Freestyle and Escape are taking a bigger bite.

The Chicago Tribune is a Tribune Publishing newspaper.

Copyright © 2019, The Baltimore Sun, a Baltimore Sun Media Group publication | Place an Ad
91°