Auto Makers’ June Sales Anticipated to Be Strong

Auto makers are expected to report sizzling U.S. sales for June when they release results this week, boosted by a growing pile of cash, cheap loans and other incentives for consumers.

Wall Street analysts see sales for the month running at a seasonally adjusted annual rate of about 16.9 million vehicles, matching last month’s performance and just slightly behind the 17.1 million rate of June 2000.

With the economy still in flux, much of the strength will come from the incentives auto makers are offering to lure customers into showrooms, averaging more than $1,800 a vehicle.

A large chunk of the month’s strength is thought to have come from a General Motors Corp. program offering some lease buyers early cancellations of their leases if they take a new GM vehicle instead. About 300,000 GM buyers are eligible, and GM expects up to 25% to take the company up on the offer.

Analysts said the program will probably keep GM’s sales even or slightly ahead of results from June of last year. But they also warn the effect of the program, which expires July 15, will be fleeting.

Ford is experimenting with its own lease-trade program on its Windstar minivan and has added dealer incentives to its F-Series pickups.

The Chrysler side of DaimlerChrysler was already offering incentives averaging more than $2,400 a vehicle going into June, higher than any other auto maker. Its sales are seen as essentially flat.

Once again, foreign auto makers are expected to improve their sales and market share in the United States. In May, Detroit’s Big Three held 63% of the market, compared with 65.6% last year and far below historical levels.

Analyst Saul Rubin of UBS Warburg estimates that Toyota Motor Corp.’s sales will be up 15%, and Honda Motor Co.’s sales will be up 5%.