May Car Sales Decline Slightly

U.S. car sales fell 1.2% in May, with General Motors Corp. gaining slightly but Ford Motor Co. and Chrysler Group continuing to lose ground.

Imports rose sharply, with many racking up record monthly sales at a time when the industry’s annualized sales rate is 16.64 million, which would make this year the third-best ever, behind 1999 and 2000. The strength of the auto market is closely watched as a barometer of the country’s overall economy.

GM’s sales were up 1%, with car sales down 8.6% but truck sales up a strong 10%, led by the full-size Silverado pickup truck, which recorded its best month since October 1978.

Ford sales were down 11.6%, with cars down 12.4% and trucks down 11.1%. Sales by DaimlerChrysler’s Chrysler Group, which does not include Mercedes-Benz, were down 8% overall, with cars off 5.9% and trucks down 9.3%.

Sales of Ford’s popular Explorer declined 16.5%. But Ford said the Explorer, the country’s best-selling sport-utility vehicle, gained market share in an increasingly crowded mid-size SUV segment.

Despite the numerical decline in Explorer sales from a year ago, its market share went from 21.9% of the mid-size SUV segment in February to 26.6% in April, said George Pipas, Ford’s director of sales analysis and reporting.

Pipas didn’t have the Explorer’s market share for May, but he said the April figure was only 0.7 percentage point lower than a year earlier, when the Explorer was setting sales records on its way to a record 445,000 units sold last year.

“The economy isn’t growing at 5% like last year; it’s growing at 1%,” Pipas said. “All mid-size SUVs are affected by the lower economy, high gas prices and increased competition.”

But the Explorer also is continuing to suffer fallout from the Firestone tire recalls of last summer. Firestone tires on Explorers were recalled after scores of accidents. Ford and tire maker Bridgestone/Firestone Inc. continue to trade accusations over who is to blame.

“The negative publicity is bound to have an impact,” said Tom Libby, an analyst with J.D. Power & Associates in Detroit. Despite the 2002 Explorer being completely redesigned to be safer and more stable, “it’s got the same name,” Libby said.

GM surpassed Ford in sales of large pickup trucks, where Ford has long been dominant.

GM’s trucks were boosted in May by sufficient availability, continued demand and an “industry-leading truck lineup,” said Paul Ballew, GM’s director of industry analysis.

GM’s move to put significant resources into large trucks is starting to pay off, Libby said. “Now their full-size pickups are newer than all but the [Toyota] Tundra, and they’re very competitive in full-size sport-utilities.”

Its new mid-size SUVs--the Chevy TrailBlazer, GMC Envoy and Oldsmobile Bravada--are just going on sale to replace aging trucks that weren’t competitive with the Jeep Cherokee, Dodge Durango and other rivals, Libby said.

In May, GM sold 90,257 Chevy Silverados and GMC Sierra pickups, including 70,324 Silverados, compared with 75,952 Ford F-series. The F-series pickup has been the best-selling vehicle in America for 19 years and has outsold the Chevy and GMC pickups combined by a comfortable margin for the last three or four years.

Toyota Motor Co. recorded its best-ever month in 44 years of doing business in this country, and its Lexus division scored its best May. Honda recorded its second-best month in the U.S., while its Acura division set an all-time record.

Mitsubishi Motors had its best May in history, while Mazda rose for the ninth straight month but did not set any records. Nissan was down 5.6% and its Infiniti luxury division was down 17.9%.

Mercedes-Benz and Bayerische Motoren Werke also racked up their second-best-ever months. Volkswagen reported its best May sales in 28 years and its best month overall since 1979, while Audi, its luxury brand, set an all-time record for the first five months of the year and saw its best May since 1985.

Among the South Korean manufacturers, Hyundai and Kia also posted best-ever U.S. sales months.

For the first five months of the year, U.S. vehicle sales were down 5.6% from last year, when a record 17.4 million vehicles were sold.