Newsmax TV & Webwww.newsmax.comFREE - In Google Play
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
Tags: 2500 | 500 | ALLTOP | AMERICAME | ASIA | ASIAX | AUP

Auto Sales May Approach ‘Clunkers’ Highs in Rebound

Wednesday, 16 March 2011 12:54 PM

(Corrects net income in sixth paragraph of story published Feb. 28.)

Feb. 28 (Bloomberg) -- U.S. automobile sales in February may approach the fastest pace since the government’s “cash for clunkers” program as rising consumer confidence spurs purchases.

Light-vehicle deliveries, to be released tomorrow, may have run at a 12.5 million annual rate, the average estimate of 10 analysts surveyed by Bloomberg. The seasonally adjusted rate in January and December was 12.6 million, according to Autodata Corp., the fastest since the 14.2 million rate during “cash for clunkers” in August 2009.

Confidence among U.S. consumers rose in February to the highest in three years, according to separate reports from the Conference Board and Thomson Reuters/University of Michigan last week. The percentage of consumers planning to buy a new vehicle within six months increased to 4.6 percent from 3.1 percent at the end of last year, the New York-based Conference Board said.

“The measures in the consumer confidence surveys that relate to autos have picked up more than the overall index,” said George Magliano, a New York-based senior economist for IHS Automotive. “The consumers with jobs are feeling better about the economy and have held off purchases for quite a bit.”

Trucks and sport-utility vehicles continue to drive sales, with increases of more than 35 percent in February, according to J.D. Power & Associates. It is too early to determine if oil prices at the highest in more than two years will derail those gains going forward, said Dave Cutting, an analyst for the researcher in Troy, Michigan.

‘Solid Start’

General Motors Co. predicted oil would rise before it surged to a three-year high, Chief Executive Officer Dan Akerson said last week after reporting 2010 net income of $6.17 billion. Akerson said on a conference call that he sees a “solid start” in the first quarter of 2011 after the Detroit-based automaker had its most profitable year since 1997, when it was known as General Motors Corp.

GM may lead the industry with a 36 percent gain in February deliveries, the average of five analysts’ estimates.

Toyota Motor Corp. may say sales climbed 27 percent, the average of four analysts’ estimates. The world’s largest automaker suspended U.S. sales and production of eight models early last year as it recalled millions of vehicles for unintended acceleration defects. The company’s share of the U.S. market fell to 12.8 percent in February 2010, the lowest since July 2005, according to Autodata.

GM, Toyota Incentives

GM and Toyota City, Japan-based Toyota may have spent more on discounts and sales incentives than a year earlier while the overall industry reduced promotions, according to consumer auto- pricing websites Edmunds.com and TrueCar.com.

GM “says they are using targeted incentives; I think I heard that term before bankruptcy,” George Pipas, Ford Motor Co.’s sales analyst, said today in a briefing with reporters in Dearborn, Michigan. GM emerged from bankruptcy in July 2009.

Discounts to employees and their families accounted for about 15,000 of GM’s monthly deliveries, said Jesse Toprak, vice president of industry trends at TrueCar in Santa Monica, California. Toyota’s incentives increased 19 percent for the industry’s biggest gain from a year earlier, TrueCar said.

GM rose 28 cents to $33.53 at 4:15 p.m. in New York Stock Exchange composite trading. Ford fell 2 cents to $15.05.

Toyota Recalls

Toyota on Feb. 24 recalled 2.17 million Toyota and Lexus vehicles sold in the U.S. for carpet and floor-mat flaws that could jam gas pedals, the biggest such announcement in a year. U.S. safety regulators and NASA, the U.S. space agency, this month said their review of Toyota recalls found no evidence of electronic causes for unintended acceleration in Toyotas.

“It doesn’t look like the NASA findings had a huge effect on consideration,” said Jessica Caldwell, an analyst at Edmunds, which is also based in Santa Monica. “Any recall for Toyota and the industry now in general makes the news. I think people have started to tune that out because the problems are complicated and so many things have gone wrong.”

Ford, the second-largest U.S. automaker, may report a 6.5 percent gain in February sales, the average of six estimates. Chief Executive Officer Alan Mulally said on a Jan. 28 conference call that the industry environment for 2011 is “favorable” even amid higher oil prices.

Sales of new models such as Dearborn-based Ford’s redesigned Focus compact and Chrysler Group LLC’s 300 sedan will boost industry sales this year, J.D. Power’s Cutting said.

Chrysler Updates Models

Chrysler, based in Auburn Hills, Michigan, may say sales rose 6.1 percent, the average of five analysts’ estimates. The 300 is one of 16 redesigned or refreshed vehicles Chrysler introduced in the past year, including 11 in the fourth quarter.

Monthly sales gains for Chrysler may trail competitors until inventories of those new models are built up, said Toprak, of TrueCar.

“Chrysler is still in wait-and-see mode,” he said. “A lot of their new models are not in dealerships yet.”

Deliveries at Tokyo-based Honda Motor Co. may have risen 12 percent, and Yokohama, Japan-based Nissan Motor Co.’s sales may have increased 19 percent, according to the average of four analysts’ estimates.

Light-vehicle sales in 2010 rose to 11.6 million from a 27- year low in 2009. Deliveries were still 31 percent less than the average 16.8 million annual average from 2000 to 2007, according to Autodata, the Woodcliff Lake, New Jersey-based researcher.

The following table shows estimates for car and light-truck sales in the U.S. Estimates for companies are a percentage change from February 2010. Forecasts for the seasonally adjusted annual rate, or SAAR, are in millions of vehicles.

--With assistance from Tim Higgins in Southfield, Michigan. Editors: Jamie Butters, John Lear.

To contact the reporter on this story: Craig Trudell in Southfield, Michigan, at [email protected]; Keith Naughton in Southfield, Michigan, at [email protected]

To contact the editor responsible for this story: Jamie Butters at [email protected]

© Copyright 2022 Bloomberg News. All rights reserved.

(Corrects net income in sixth paragraph of story published Feb. 28.) Feb. 28 (Bloomberg) -- U.S. automobile sales in February may approach the fastest pace since the government’s “cash for clunkers” program as rising consumer confidence spurs purchases. Light-vehicle...
Wednesday, 16 March 2011 12:54 PM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
Get Newsmax Text Alerts

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved
© Newsmax Media, Inc.
All Rights Reserved