New vehicle demand off in October
DETROIT (AP) – General Motors Corp. and Ford Motor Co., the nation’s two-largest automakers, both said demand for new vehicles last month was off 5 percent from a year ago, even as Japanese competitors Nissan Motor Co. and Honda Motor Co. rode a slew of new products to double-digit sales gains. No. 1 GM said truck sales were off 4.6 percent and car sales down 5.5 percent. Sales of Ford, Lincoln and Mercury brand trucks were up 3 percent at No. 2 Ford, but that demand was not nearly enough to offset a 22 percent decline in car sales – an all-too familiar trend for Ford this year.
October marked the eighth time this year Ford’s monthly sales have been below year-ago results.
Many analysts’ predictions for the month appear to be right on the mark. They expected sales to cool in October after climbing to the second-highest level of 2004 in September, but they said Detroit’s Big Three carmakers, not foreign brands, would account for most of the decline.
Observers said sagging consumer confidence last month may have hurt business too.
“GM’s October sales were not as strong as we had expected, but not entirely surprising given our exceptionally strong sales in September,” said John Smith, GM’s group vice president for North American vehicle sales, service and marketing, citing GM’s 20 percent year-over-year sales jump in September.
Smith said the automaker expects stronger car sales in particular in the coming months as more shipments of new models such as the Buick LaCrosse and Chevrolet Cobalt enter the market.
Honda said its sales rose 10.2 percent in October in part because of strong demand for two new vehicles – the Odyssey minivan and Acura RL luxury sedan. Sales of Honda’s gas-electric hybrid vehicles, the Insight and Civic, rose 43 percent from the year-ago period.
Year-to-date hybrid vehicle sales are up 72 percent, Honda said.
Combined sales for Nissan and its luxury Infiniti division were up 27.3 percent in October from a year ago, the best October ever for Nissan North America. Truck sales climbed 46 percent on strong demand for the new Nissan Pathfinder and Titan full-size pickup, the Japanese automaker’s first entry in that category.
“Sales of the Titan continue to increase even in a very competitive segment,” said Jed Connelly, senior vice president for sales and marketing at Nissan’s North American division.
Despite the year-over-year drop in business, Ford officials said they were bullish on prospects for the remainder of 2004 and beyond, given the recent rollout of several new cars and trucks, some of which are just beginning to reach showrooms in significant numbers.
They include the Ford Five Hundred flagship sedan, Freestyle crossover vehicle, Escape Hybrid sport utility vehicle and Mustang sports car.
Ford said last week that October sales of the Five Hundred and Freestyle – their first full month on the market – had exceeded company expectations. The Dearborn-based automaker said it has taken 50,000 orders for the Five-Hundred and 30,000 orders for the Freestyle.
“We’re very encouraged by the early dealer and consumer response to our new products,” said Jim O’Connor, Ford’s group vice president for North American marketing, sales and service. “We have our sights set on stronger retail sales in the months ahead.”
Korean automakers Hyundai Motor Co. and Kia Motors Corp. posted double-digit sales gains for October – Hyundai up 15 percent and Kia, aided by aggressive marketing and new vehicles, up 51 percent.
In afternoon trading on the New York Stock Exchange, GM shares were down 20 cents to $38.98, while Ford shares rose 1 cent to $13.25.
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General Motors Corp.: http://www.gm.com
Ford Motor Co.: http://www.ford.com