U.S. carmakers are back in the lead
Hello Detroit, goodbye Tokyo.
Americans were more likely to buy their vehicles from the domestic automakers last year than from the big Japanese manufacturers.
For the first time in years, American nameplates such as Chevrolet and Ford outsold the Toyota brand in the U.S.
Sales of trucks and sport utility vehicles, which are American manufacturers’ bread and butter, are on the upswing. Rental companies and commercial fleets, which favor domestic products, have been doing some heavy buying.
“Another factor is that the domestics are bringing out strong new offerings in other segments,” said Jeremy Anwyl, chief executive of Edmunds.com, the auto information company. “We have yet to see a coherent response from the Japanese.
“Toyota has had a brand image crisis, while Honda has taken a very conservative approach to market share,” Anwyl said, and “may have left sales on the table.”
Overall, Toyota Motor Corp. was the only major auto company to see sales decrease from 2009.
The trends favoring domestic automakers were occurring just as the industry was showing signs of a comeback.
“For a change, the news has been pretty positive on the economy,” said Don Johnson, GM’s vice president of U.S. sales.
The recent “extension of tax cuts and unemployment benefits will also help propel consumer spending,” Johnson said.
Overall, Americans purchased about 11.6 million vehicles last year, an 11% increase from 2009, Autodata Corp. said Tuesday.
Although they are a large improvement over the recession-depressed level of 2009, last year’s sales still were the second lowest since 1982, when Americans purchased just 10.5 million vehicles.
Bob Carter, the Toyota brand’s U.S. sales chief., said the average age of a vehicle on the road is 10 years old and ripe for replacing. Carter also said he believes that people who have delayed purchases because of the uncertain economy are starting to move into the market.
“We see very good conditions for the industry in terms of growth over the next several years,” Carter said.
Other automakers also saw favorable economic signs such as rising retail sales and consumer confidence and declining new claims for unemployment insurance.
Regardless of the brand, most automakers experienced more robust sales in the final months of last year, said George Magliano, an analyst at IHS Automotive. He cautioned against attributing too much to economic factors.
“The strong fourth quarter resulted from consumers who were looking — especially the upper end — to go out and purchase finally,” he said. “It was just pent-up demand. There was not great improvement in jobs or credit availability.”
But much was going right for the industry.
“Transaction prices went up. We weren’t giving away all these vehicles,” Magliano said. “Fleet sales declined and retail sales went up, so that’s a good sign, and people were buying at the upper end of the model line, not just the stripped-down vehicles.”
As a group the domestic combination of Chrysler Group, Ford Motor Co. and General Motors Co. grabbed 45.2% of U.S. auto sales last year, up a percentage point from 2009.
Their Japanese counterparts — American Honda Motor Co., Nissan North America Inc., and Toyota — had a combined 33.6% of the market, down from 35.4% in the prior year, according to Autodata, which track’s U.S. sales.
Chevrolet outsold the Toyota brand for the first time since 2007 last year. The American brand sold almost 1.6 million vehicles last year, compared with 1.5 million for Toyota. Ford had sales of just under 1.8 million vehicles in 2010 and outsold Toyota for the first time since 2006.
Hampered by the recall of millions of vehicles last year, and the record payment of nearly $50 million in federal fines for failing to promptly inform regulators of defects in its vehicles and delaying recalls, Toyota saw its share of the U.S. auto market fall to 15.2% from 17%.
“That is a big shift. Toyota still has these big recall programs, and that has really hurt them,” Magliano said.
Toyota’s December sales fell 5.5% to 177,488. The Japanese automaker’s 2010 sales slid fractionally — about 7,000 autos — to just under
1.8 million vehicles. The numbers include its Lexus luxury division, which narrowly beat out Mercedes-Benz and BMW to retain its title as the best-selling luxury automobile in America for the 11th consecutive year.
In addition to the fallout from the recalls, Toyota executives said sales were hurt by continuing economic problems in California and Florida, two of its core markets.
In December, General Motors sales rose 16.1% from a year earlier, to 223,894 vehicles, after factoring out the Pontiac, Hummer, Saturn and Saab brands it closed or sold as part of its bankruptcy reorganization during the summer of 2009. Of its remaining brands, Buick, Cadillac and GMC posted double-digit gains, while Chevrolet was up 9.1% for the month. Including the discontinued lines, GM’s December sales rose 8.5% to 224,147 vehicles.
For the year, sales of GM’s core brands rose 22.1% to 2.2 million vehicles. Including the discontinued lines, sales rose 7.2%.
Ford’s December sales rose 6.8%, to 190,191 vehicles. For the year, its sales including the Lincoln and Mercury brands rose 19.5% to more than 1.9 million vehicles. The automaker’s market share rose to 16.7%, up more than a full percentage point. This was the second consecutive year of rising market share for Ford and its first back-to-back increase since 1993.
“Ford has benefited from the problems at GM and Chrysler. They took the government [bailout] money and Ford didn’t. It became the American manufacturer of choice,” Magliano said.
Ford and GM noted that the consumer segment of the market was particularly strong last month.
Rental companies and commercial customers reduced their purchases as the year ended.
Ford’s rental-car sales were off 40%.
Chrysler’s December sales rose 16.4% to 100,702 vehicles. For the year, its sales rose 16.5% to almost 1.1 million vehicles. Honda’s December sales rose 21% to 129,616. Its annual sales rose 6.9% to just over 1.2 million. Honda also lost market share for the year.
Audi of America, Hyundai Motor Co. and its sister company, Kia Motors Corp., and Subaru of America all set U.S. sales records and gained market share despite the slow pace of auto sales overall. Volkswagen of America had its best year since 2003.
Analysts were impressed by the growth at South Korea’s Hyundai and its Kia sibling. They sold a combined 894,496 vehicles in 2010, up 21.7% from the prior year and very close to Nissan’s total of 908,570.
“We used to call the top makers the big six — the domestic three and the Japanese three — and now all of our analysis is based on the big seven and includes Hyundai,” said Jesse Toprak, an analyst at TrueCar.com.
Hyundai has made the leap from a brand for people “who couldn’t buy or afford anything else” to one that offers vehicles “people choose to buy based on the merits of the products,” he said.