AUTO INDUSTRY : Trucks Lead a Small Gain in Mid-June Vehicle Sales

Sales of North American-made cars and trucks rose 1.5% in mid-June, auto makers reported Wednesday, but the strength came largely on demand for trucks and rental cars.

The gain masked a 4.8% drop in overall car sales, with sharper drops at General Motors Corp. and Chrysler Corp. Ford Motor Co.’s sales were notably strong.

Truck sales, which have been leading the rebound from the 2-year-old downturn, were up 12.5% industrywide.

For the year to date, truck sales are up 15% and car sales are up 0.8%.

Makers reported selling 37,585 cars and trucks a day in the June 11-20 period versus 37,053 a year ago. Both periods had nine selling days.

U.S. Commerce Department projections show that the seasonally adjusted annual sales rate for cars was 6.4 million. That was the same rate as a year ago, the industry’s worst since 1983.

“My biggest concern is we’re starting that same upward spike that we had in June and July last year,” said analyst Joseph Phillippi of Lehman Bros. in New York. “I’m hoping we’re not looking at that same situation again where the bottom falls out, but I think we’re OK this time.”

No. 2 Ford continued to pace the 10 auto makers that build vehicles in the United States, with 9.9% higher car sales and 12.4% higher truck sales in mid-June.

Ford said its car sales were boosted by strong demand from rental car fleets stocking up for a summer travel boom created by recent air fare price wars. Rental companies are keeping cars beyond the standard six-month service period and taking early delivery of cars due in July.

No. 1 GM reported a 6.9% decline in car sales, the second consecutive 10-day period in which sales trailed year-ago levels after a strong late May. Truck sales rose 0.6%.

GM has its stars, including the redesigned Pontiac Grand Am, which is especially popular because of financing incentives.

Jim Druce, Pontiac sales manager at Red Holman Pontiac-GMC Truck-Toyota in Westland, Mich., said the Grand Am accounted for half of his sales in recent weeks.

“You can basically drive this car for about $225 a month and, at the bottom line, it comes down to the monthly payment,” Druce said.

Chrysler car sales fell an estimated 17.4%, but its bread-and-butter minivan and Jeep sales led to 12.4% higher truck sales for the period. The No. 3 auto maker has extended its minivan sales promotion through Aug. 31.

“Dealers are still saying traffic is holding up and the quality of the customer is improving,” said John Casesa, an analyst with Wertheim Schroder & Co. in New York. “People with more money are shopping, and banks are showing an increasing willingness to make car loans.”

Among Japanese makers with U.S. plants, Honda and Mazda reported car sales down 25.3% and 34.4% respectively.