Gm Gets Slight Lift From Truck Sales

by : KatieJones



Auto industry got loads of surprises. Sometimes you just have to expect the unexpected. In February, the Ford Motor Co. and Chrysler Group suffered sales decline. Other critics expect that General Motors Corp. would also suffer the same plight. Unfortunately, their guess is not as good as any one else. This is because GM sold more vehicles than expected.

Last month GM reported a 3.7 percent improvement over a year ago despite a flat U.S. market and poor results at rivals. The February sales success of the automaker is attributed to slight lift made by the oft-maligned truck market. GM truck sales were increased by about eight percent for the month. Autodata Corp. reported that light truck sales rose by about 0.2 percent overall. Excluding GM, light truck sales fell by 2.5 percent.

Analysts in the industry said the truck market, long the bread and butter of American automakers, will continue to be squeezed by vacillating fuel prices and a soft housing market. Same factors also injure Japanese trucks, as well.

It seems that the cool breeze from is spreading good vibes in favor of the automaker. "Those segments that are suffering have kind of overshadowed the success we're having with our new vehicles," said Brad Bradshaw, the senior vice president of sales and marketing for Nissan North America.

Nissan reported brisk sales of its Altima and Infiniti G35 cars nonetheless sales of their sport utility vehicles dropped. Overall, Nissan sales were increased by 1.2 percent. Toyota Motor Corp. and Honda Motor Co. also posted sales gains. The difference, experts said, is that GM has some of the freshest trucks on the market, and in February it increased incentives on some models just enough to woo shoppers into its showrooms.

"The view from GM's window is going to be a little different than the view from Ford and Chrysler," said Erich Merkle, the chief of forecasting for IRN Inc. in Grand Rapids. "Given the fact that the Chevy Silverado and GMC Sierra are all new, they may have the best shot at holding on and keeping any declines at a minimum later in the year. GM has several other new light trucks -- a category that includes minivans and SUVs -- to help buoy its results this year," said Merkle pointing to the Saturn Outlook and GMC Acadia car-based SUVs.

Merkle added, "The safe haven in 2007 is going to be in crossover SUVs, but more specifically crossover SUVs that price out above $30,000. In the case of GM, that's going to help them out more than most people are giving them credit for."

To some analysts, the February sales results of GM were surprising. "GM did better than anyone expected," said Jesse Toprak, the executive director of industry analysis for Edmunds.com in Santa Monica, Calif. "I think they did better than they expected." GM, on the other hand, admitted that it expected February sales to be even with a year ago.