THE ECONOMY : Domestic Vehicle Sales Rose in Early December
Auto makers reported Tuesday that their sales of domestically built cars and trucks surged 17.9% in the first 10 days of December, their best early month showing since June.
“As far as Detroit’s concerned, this is perhaps where Santa Claus has come to town,” said David Garrity, an auto industry analyst for McDonald & Co. Securities in New York.
Auto sales traditionally are weakest in the first 10-day reporting period of a month. They usually improve in the middle 10 days and peak in the last reporting period.
The projected 6.5 million sales rate in early December for North American-built new cars was further evidence of recovery, following a projected annual rate of 7.3 million car sales in the last 10 days of November.
Domestically built light trucks such as pickups, minivans and sport utilities sold at a 4.8 million projected annual rate, following a 4.6 million projected annual rate in late November.
Adding estimates for imports and heavy trucks, early December sales worked out to a projected annual rate of about 14 million, well above the expected 13 million actual sales expected this year.
“If you smooth them out over 30 days, it looks like we’ve got a real recovery going here,” said David Healy, an auto industry analyst with S.G. Warburg & Co. in New York.
Ford Motor Co., which reported a 49.9% increase in car sales, was the biggest factor in the overall sales surge. Chrysler Corp. also had steadily improving car sales, estimated by Ward’s Automotive Reports to be 30.1% higher than in the same period a year ago. Chrysler reports its sales only monthly.
Among the U.S. Big Three--GM, Ford and Chrysler--only General Motors Corp. had lower car sales than last year, down 11.7%. All three companies reported higher truck sales.
Ford and Chrysler stole market share from GM in the Dec. 1-10 period. GM’s 41.4% share of the car market in early December was about 3 percentage points below its year-to-date share.
About 40% of Ford’s overall car sales increase was attributable to a 132% jump in sales of its Taurus mid-size sedan.
Taurus is battling the Honda Accord to be the best-selling car in the United States for the year, a title Accord has held for three years running.
Taurus trailed Accord, which is primarily built in Ohio, by about 14,700 cars entering December. Ford closed most of the gap with sales of 13,629 Taurus models in early December. Honda sold 5,407 Ohio-built Accords.
The winner will be known early next year when Honda reports December sales of imported Accords. Both companies have aggressive incentives for customers. Ford gives customers a choice of a cash rebate or low interest rates. Honda is offering dealers a cash incentive for each Accord sale.
