Sales of U.S.-Built Cars Rise 4.4% in Mid-June
With less than a month left before the scheduled end of cut-rate financing offers from Detroit, domestic new car sales increased 4.4% in mid-June, the seven U.S. manufacturers reported Tuesday.
Domestic auto makers sold 251,842 cars in the June 11-20 period, compared to 241,251 in the comparable 1985 period. There were nine official selling days in both periods.
Industry analysts attributed the strong sales performance to consumers’ renewed interest in the incentives offered by the major U.S. manufacturers. Detroit’s Big Three auto makers have been luring buyers with cut-rate financing ranging from 5.8% to 10.9% since mid-April. The programs are scheduled to end in early July.
“The big question is what is going to happen at the end of the month when the incentives expire,” said Ted Sullivan, an analyst with Chase Econometrics. “Unless new incentives are introduced, domestic car sales could fall off a cliff.
“The market is not as strong as the sales figures suggest,” Sullivan added. “The manufacturers have been manipulating the market (with incentives), adding strength to a tired market.”
Of the major U.S. auto makers, only Ford reported a decline--down 7.1% for the period. GM sales were up 11.2% and Chrysler’s 8%.
American Honda’s sales increased 10% in mid-June, while AMC and Volkswagen reported declines of 38.9% and 19%, respectively. Nissan U.S., which has halted production at its Smyrna, Tenn., plant for retooling, did not release sales figures for the period.
On a seasonally adjusted basis, domestic new cars sold at an annual rate of 8.3 million, up significantly from the 7.9-million annual rate recorded in the year-ago period. The annual rate indicates the number of cars that would be sold if a period’s sales pace were to continue for a full year.
Sullivan noted that the sales rate was especially good given the strong presence of imports in the U.S. market. Import manufacturers report sales on a monthly basis only.
Auto Sales
June 11-20 June 11-20 % 10-Day 1986 1985 change GM 149,086 134,014 +11.2 Ford 59,785 64,333 -7.1 Chrysler 34,467 31,915 +8.0 AMC* 1,620 2,650 -38.9 VW U.S. 1,749 2,160 -19.0 Honda U.S. 5,135 4,667 +10.0 Nissan U.S. N.A. 1,512 -- TOTAL 251,842 241,251 +4.4 * Estimate
