Beware the Ides of March! OK, relax. The sales figures are in for Julius Caesar’s final month. While it's hard to find new ways to say "GM, Ford and Chrysler sales are sinking while Toyota's eating their lunch" month after month, it's not impossible. How about this: The Big 2.5 look more and more like Lawrence Edward Grace Oates (to Toyota’s Roald Amundsen). “I am just downsizing and may be gone for some time.” Anyway, the more things change, the more they change the same.
Compared to last March, GM sales sank four percent, Ford’s plunged nine percent and Chrysler Group’s tumbled 4.6 percent. Overall, domestic vehicle sales were down 3.7 percent— against the backdrop of ToMoCo's 11.7 percent sales gain. Despite Toyota's seemingly unstoppable ascension (managing Detroit's decline is still job one), there were a few reasons to be cheerful.
Pre-divestiture Chrysler watched The Dodge Boys move 32 percent more Calibers than last year, proving that their macho SUV-lite has legs. Less explicably, Charger sales galloped ahead by 40.8 percent. And thanks to the runaway success of their new four door, Jeep Wrangler sales scrabbled ahead by 63.8 percent.
The Ford Fusion continues to gain traction; sales are up 47.5 percent over last year. Capitalizing on the small car surge, Chevy sold 53.1 percent more gas-sipping Aveos in March ‘07 than in March ‘06. At the other end of the CAFE spectrum, Expedition sales rose 27.8 percent while Suburban sales were up a gargantuan 73.3 percent.
March on March, import sales were up 17.5 percent. Mazda came in with the lion’s share; the Ford sub’s sales rose by 47.9 percent. Mitsubishi showed a healthy 22.3 percent increase. Stalwarts Toyota and Honda clocked 15.6 and 13.6 percent increases, respectively. It would’ve been an even more dramatic import victory if not for Scion (down 23 percent), VW (down 15.3 percent) and BMW (MINI tumbled 5.1 percent).
For the most part, inventory levels declined across the board. Only two Fords exceeded the magical 90-day supply mark: the Mark LT (101 days) and Montego (95 days). Chrysler has recovered from the sales bank fiasco; only low volume models (Viper, Crossfire, Sprinter) are languishing on lots. That’s aside from the 117-day supply of Jeep Compasses, up 11 days from February.
While GM averages an 86-day vehicle supply, GMC has a 149-day supply of Canyons and a 125-day supply of Sierras. Chevy dealers hold 102 day’s worth of Silverados and 101 day’s worth of Colorados. Saturn lots are clogged with 214 days’ worth of IONs and Pontiac dealers are feeling the Vibes for 129 days. Meanwhile…
The average Toyota had a 46-day shelf life. Nissans disappeared in 67 days. Even last month’s lot queen, the Mazda B-series truck dropped from a 229 to a 183-day supply. Once again, the Honda Fit led the pack with just 13-day's supply ready for sale.
In sales per dealer (SPD), Toyota once again topped the chart, up 39 sales to 175 SPD. Surprisingly, Ford averaged more SPD than Chevy (57 vs. 52). At 38 SPD, Dodge led the way for Chrysler Group. In contrast, Mercury dealers moved seven units apiece. Once again, Buick set the floor, averaging only six sales per dealer.
Three manufacturers saw full-size pickup sales increase from February to March: Ford (up 16.2K), Dodge (up 9.6K) and Toyota (up 3.5K). After a healthy jump from January to February, total sales of GM’s newly- launched GMT900 pickups decreased by 4.7K units in March.
Considering increased Sierra and Silverado inventory levels, and a sales decrease against its competitors’ increases, this could be an early indication of serious problems to come. Unless GMT900 pickup truck sales pick up or GM cuts production, we’re looking at a significant summer clearance sale. Any price reduction would likely be met in kind, leading to the beginning of the end for full-size pickup truck margins (as previously predicted here).
At the same time, domestic manufacturers have been slow to offer suitable alternatives to their larger and more profitable trucks. It may be too late to regain lost ground. In March, domestic light truck sales sank 4.8 percent while more economical imported light trucks rose 18.3 percent. GM’s small pickups—the Canyon and Colorado– fell by 14.6 and eight percent respectively. Toyota’s Tacoma is up 16.5 percent.
Taken as a whole, March’s sales figures indicate that the domestics are still struggling to stem the transplants’ ceaseless onslaught. The trend toward downsizing also continues, although perhaps not as radically as some have predicted.
Next month, TTAC’s launching some new methodology. I’m trending sales for selected vehicles from The Big 2.5 and Toyota in four different categories: Passenger Cars, Full-sized Trucks, Truck-based SUVs, and Car-based CUVs. I’ll post graphs showing the comparative results along with data from the same time last year. This should give us greater insight into sales trends across brands and models.
Frank—great re-cap and look forward to next month’s graphs.
What will be interesting on the full size pick-up front is the “Tundra effect”.
Toyota has spent A TON of money on this launch from a new factory (San Antonio) to the biggest launch budget ever allocated to a new Toyota vehicle. Early results on the sales front are just OK—but several mis-steps on the pricing and mix front are biting them and they have $3000 off on the hood barely 3 months into launch
Adding to the severe cost over runs to build the San Antonio plant…they better start selling more of these pick-ups to justify the investment as I am sure their strategic intent for this launch was not as “loss leader”.
That said—-if as you predict—pickup margins erode with bigger rebates than Toyota is currently offering on the Tundra—-loss leader might be the default strategy. Not good for Toyota….not good for Ford or GM either.
Those figures are a little funky. You would think that canyon and colorado inventory would drop and sales increase with the rise of gas prices. Looking forward to seeing the TTAC’s take on sales via charts
It looks like there is actually a little good news for the 2.5. They CAN sell cars, but only the ones people want. So what they have to do is figure out a way to stop building the ones people don’t want as soon as it looks like they have a loser on their hands (better yet, they could figure it out before production and pull the plug).
Now the only problem will be how to make their business that flexible with union labor and insanely expensive top management. Oh well, hasta la vista, Michigan.
I’m looking forward to the charts. A month by month comparison by model makes it tough to see the forest from the trees. Example: Silverado was flying out of dealerships in Feb and Jan, but tanks in March — is that a trend, or just the result of a regional sale?
Interseting to see the Caliber doing well vs. the Compass. My take is that even though they are twins under the skin, people prefer the image of a macho econobox to that of a wimpy CUV.
Please add the ‘new’ body GMT900 and the ‘old’ body GMT800 (Classic) when calculating GM light pickup sales as BOTH were sold off dealer’s lots in March. GM is pushing the Classic with $1000-2000 greater incentives than the 900’s. Looking at inventory levels as of April 1st, there are very few 800’s around, so expect 900’s to start selling.
kaisen: Please add the ‘new’ body GMT900 and the ‘old’ body GMT800 (Classic) when calculating GM light pickup sales
The sales and inventory numbers are for “Silverado”. The stats make no differentiation between GMT800 or GMT900.
I thought that the magic number was a 60-day supply.
The Compass looks like a bigger mistake each and every month. Guess people DON’T want a tall, misshapen 5-door hatch with a seven-slot grille. Even women and non-Jeep intenders.
I expected to an increase for all the small cars, but I’m still stymied by the big increases in SUV full-sizers.
You know, I would love it if there were some sort of database that you could query for car sales statistics. Do all companies break down sales per vehicle? It would be really neat (hint, hint) if you could pick cars from drop down style menus and chart them on a graph, sort of like yahoo finance with stock prices.
That would definitely be a cool and unique feature for a website! Quite a bit of navel gazing though…
I always prefer the raw numbers to percentage up or down. How many trucks is Toyota or Nissan really selling? How many trucks in a 10% increase – 1,000 or 5,000 or? The comparison of % increase / decrease in sales is useful for marketing, but TTAC can do better than that.
Full inventory figures are here:
http://www.autonews.com/assets/PDF/CA16747413.PDF
(This link may expire in a few days.)
GM’s sales are here:
http://media.gm.com/servlet/GatewayServlet?target=http://image.emerald.gm.com/gmnews/viewmonthlyreleasedetail.do?domain=3&docid=34960
Ford’s sales are here:
http://media.ford.com/newsroom/release_display.cfm?release=25738
Toyota’s sales are here:
http://pressroom.toyota.com/Releases/View?id=TYT2007040316856
For inventory numbers, the best brands were Lexus and BMW. The worst were Jaguar, Isuzu, VW, Saturn, and GMC (and GM in general).
As for sales figures, Ford’s numbers were basically flat if you factor in the disconituation of the Taurus and drop it’s figures from the old totals. GM was down across the board, especially from Buick and Hummer, except for Saturn-although the inventory levels show that although Saturn is stuffed with new product, that new product is not moving all that quickly. The biggest news in Toyota’s always good sales is the Prius, up 133.2%.
Nissan moved 7,563 Titans compared to 8,328 Last March.
Frontier moved 7254 vs 8433.
Frank-
Sorry for tricking you into making my point. You mention only the GMT900 in your article: “After a healthy jump from January to February, total sales of GM’s newly- launched GMT900 pickups decreased by 4.7K units in March.”
If they don’t break them out in the data you are sourcing, how do you know?
CarShark:
I thought that the magic number was a 60-day supply.
I’ve seen references to a 45-day supply (an almost impossible goal), a 60-day supply, and a 90-day supply. When I ran the numbers using 60 days with my spreadsheet configured to turn any cell above that goal bright red, it lit up like the Fourth of July. I can provide numbers using the 60 day cutoff but it won’t be pretty. BMW, Honda, Hyundai-Kia, Porsche, Subaru, and Toyota were the only manufacturers to undercut the 60-day limit overall, and each of them had one or two models that went over. Everyone else scored primarily in the 60-90 day range. The only manufacturers that ended the month with a higher daily average than they started with were VW (+10 day supply) and GM (+4 day supply).
kaisen: Sorry for tricking you into making my point. You mention only the GMT900 in your article: “After a healthy jump from January to February, total sales of GM’s newly- launched GMT900 pickups decreased by 4.7K units in March.” If they don’t break them out in the data you are sourcing, how do you know? What difference does it make? If the GMT900s aren't taking up the slack from the dwindling GMT800 inventory, they're still losing sales and still have a problem. In fact it could point to an even bigger problem – that the "Classic" buyers aren't sticking around to buy the 900, and once the 800s are gone there will be an even greater drop in sales.
Sherman Lin –
After I totalled my Sierra in January, I decided to buy a smaller pickup for better fuel mileage. For the 2007 Colorado 4 cylinder the EPA is 17/24 with automatic. For the 2007 Tacoma the EPA is 21/27 with automatic. (The Colorado does pump out more HP). Based on the difference in mileage, I selected the Tacoma.
Heck, at the mileage the Colorado gets, you might as well buy the Silverado.
I have not done the math, but I strongly suspect that the true cost of ownership of a Canyon and a Sierra is virtually identical. When you factor in reliability (Sierra much better) and gas mileage (strangely similar). At least, when comparing a decked-out-Canyon versus a fairly pedestrian Sierra. So why buy a Canyon? The numbers aren’t there.
Sherman: To echo what Matt51 said, most of the “small” trucks nowadays get virtually the same MPG as the “full size” versions with the smaller engines. In reality, there are no “small” trucks anymore, just “mid size” trucks that are almost the same size as the full size trucks of 30 years ago, and “full size” trucks that are about 25% bigger. The days when you could buy a small truck and figure on saving money on gas (my 84 Mazda B2000 got over 35 mpg on multiple occasions) are over. One can hope that increasing gas prices would make some enterprising manufacturer realize there’s a profit to be made from economical small trucks, but apparently no one has. Meanwhile the “mid-sized” Toyota Tacoma is about the same size as the “full size” T100 of 10 years ago.
Frank: A question about statistics: given that the Big 2.5 have (as we have often complained about) a bloated dealer network, aren’t Sales per Dealer a relatively meaningless statistic? If there are 5 GM dealers for every Toyota dealer, then a Toyota dealer with 5x the sales would just be on par with the 5 GM dealers, right?
You are reading it here first that Chrysler’s sales will be up 5% in April 07. March 06 was the last strong month for Chrysler before they ran into troubles. Beginning April 06, sales started to crash, and the product mix in play in April 07 should not have a problem exceeding prior year numbers by at least 3-5%.
Frank: A question about statistics: given that the Big 2.5 have (as we have often complained about) a bloated dealer network, aren’t Sales per Dealer a relatively meaningless statistic? If there are 5 GM dealers for every Toyota dealer, then a Toyota dealer with 5x the sales would just be on par with the 5 GM dealers, right?
Generally speaking, yes. One other factor is that many GM dealerships sell more than one brand, so the total average sales per month for a specific dealership may be quite a bit higher than you would surmise from the SPD numbers. But when you consider that GM has more total sales per month than Toyota but has markedly lower sales per dealer, it emphasizes the fact they have a bloated dealer network that needs to be trimmed down and made more efficient.
What difference does it make? You quote the GMT900, but you meant ALL Silverado/Sierras. Nevertheless, the (old and new) GM trucks are up over 9,000 units year-to-date. Slipped in March. Sky must be falling.
kaisen has been warned for impugning Mr. Williams journalistic integrity. Our posting policy: Commentators are not allowed to flame (personally insult) the site, its authors or fellow commentators. Persistent offenders will be permanantly banned from posting.
Those sales per dealer numbers are interesting and say something about which franchise a business person would want to own. How about a nice Saturn franchise with strict rules and an average of 48 units sold in the month. You can argue that some of the GM brand dealerships have multiple brands under once roof, like Pontiac-Buick-GMC, but the lucky Saturn dealer has to have a big stand alone facility. Even Mazda doesn’t have that as a firm requirement, the nearest Mazda dealership to us is a dual VW-Mazda shop. Much better to be selling Hondas at 125 per dealer or Toyotas at 175.
Hmmm, adding up Pontiac, Buick and GM still only gets you to 35 units for the month. These sales are also highly contested and likely to be at rock bottom levels, unlike Honda Fits or Toyota Priusz. Maybe service work is keeping these GM dealers alive??????
The new Honda Accord and a revamped Civic/Camry interior (and the new Toyota Corolla) might just make Ford/GM under-$20K passenger cars irrelevant since the Fusion/Impala are the only cars selling (The Aveo is just a zero (negative?) profit CAFE-mobile in a buy an Escalade and get an Aveo for free kinda way). The new Malibu cant come soon enough…And watch out for Hyundai/Kia.
IF Toyota lowers the price of the entry-level Tundra, replaces the belt-driven 4.7L with the new chain-driven 5.0L (Next year I think), and ramps up CrewMax/5.7L production, then, ouch!
If Toyota answers Expy/Suburban with the new Sequoia and answers Edge/Outlook/Acadia then, ouch!
GM needs the Chevy version of the Acadia put on the fast track since it is a high-margin vehicle… I think the Outlook/Acadia are eating into Tahoe/Yukon sales.
The raw numbers will be revealing.
Two small notes of interest: Toyota sold more than 19,000 Prii, making it something like 12 or 14th most popular car.
Scion is temporarily out of inventory (BX, AX) until the new ’08’s come in. That explains why they’re down. Must be nice to have that problem. Gives those poor overworked Toyota salespeople a break.
same also goes for MINI; changeover to new ’08 model.
Focus, Aveo, Cobalt would be way more exciting if they were anything but what they are. Standard fare four bangers. Need hybrid, diesel, and performance models(turbo). Even an extreme fuel mileage 4 banger. Anything but those motors they put in them now. We’ve had that junk since the `70’s. Pintos, Vegas, Mavericks. Stick a big A123 pack in one of them and see how many miles it can eek out.
There are 40, count ’em FOURTY, Prii sitting on used car lot near me. Seems like they’re getting dumped faster than they’re selling.
When one says “117-day supply”, is that at the rate of one per day or how many?
Prius has had incentives this year that it didn’t need in previous years
When one says “117-day supply”, is that at the rate of one per day or how many?
Days supply: Number of days needed to sell all vehicles in inventory, based on the previous month’s daily selling rate.
Inventory: Unit count of vehicles on hand at dealerships, factory lots, ports of entry and in transit on a specific date.
Toyota has drastically increased production of the Prius. They have added some incentives (0% financing-but only for 24 months) to help move them, and there are no longer any waiting lists. So, for every 3 Priuses they sold in March 2006, they sold 7 in March 2007.
Also, the Prius has (I believe) exhausted its tax-discount, and there are no longer any CA carpool lane stickers.
That it still sells at all, let alone more than last year, says production is WAY up.
rtz wrote: “Focus, Aveo, Cobalt would be way more exciting if they were anything but what they are. Standard fare four bangers. Need hybrid, diesel, and performance models(turbo).”
Having rented a Cobalt last year, the vehicle desperately needs an interior designer. It actually has features one wouldn’t suspect because it’s dangerous to try and look for them while driving.
Plus…it feels less solid at…some number of MPH that other less than 20K vehicles. GM should work on that.
Finally, TTAC’s web folks should work on the software’s handling of greater-than-signs, less-than-signs, etc. I’m editing this comment because the previous version contained these symbols resulting in a garbled post.
It boggles my mind looking at these reports how any Mercury or Buick store can stay in business generating such slim average sales per month. The overhead on these dealerships must be driving dealers near to bankruptcy –hence there must be some damn good deals available when you walk on one of these lots. Recently while in Florida on an avenue of car dealerships the Mercury Lincoln store and its employess had the look of a low grade undertaking parlour in a town of healthy people.
Official Nissan and Infiniti figures can be found here.
The new G sedan is up 60% and they actually sold 2 Q45s vs 80 last March for a 92% decrease! That’s not good for statistics…
As good as the G-series and M-series are for Infiniti…why has the Q-series been so useless?
what big 2.5 optimists call downsizing, pragmatics call mass extinction.the biggest yankee hardware exodus in history, to give place to more agile and flexible Tubulcaine servants of the rising star region.I suspect big 2.5 realizes their faults( for their concept vehicles have a top notch fit and finish, while down the assembly line go more junkee style vehicles).Yet they don`t have smart enough engineers and employers whose hands would be artisan and demanding enough.And because demand doesn`t shrink so the void must be filled with foreign vehicles. I am surprised that 2.5 is so scared that their models would cannibalize each other sales, if representing the same niche. Jesus Christ, toyota has a plethora of minivans, still they don`t think like this. I think 2.5 just wants to find another excuse to avoid vehicle manufacturing or adding new models.
TheHammer: “Rarely are those franchises “stand alone” stores. Mercury most likely teamed with Ford/Lincoln while Buick resides alongside Pontiac and GMC franchises.”
But, they use to be strong enough in sales to support stand alone stores. In Tampa in the 1990’s I use to listen to a weekly car radio show hosted by the owner of a local Buick dealer Scott Buick. Their tag line was they were the 4th highest volume Buick dealer in the country. Well the Buick side of their buisness has shut down. They still have a Saab franchise
A few things:
GM has already announced increased incentives will be coming for the Silverado/Sierra. GM also mentioned that some sort of summer “clearance” program will be coming as well.
Tundra sales continue to go up. The new Crewmax model just came out in March, and dealers are struggling to keep up with demand for it. Toyota is working to increase CrewMax production, while decrease regular cab production. Toyota estimated 50 – 60% of all Tundra sales would be of the 5.7L models, but right now that figure is at 70 – 80%. So what this all means is that the higher priced, top model Tundras are selling very well, and the base model regular cab Tundras not so much. Toyota is selling mostly higher priced, high profit Tundra models, which is not good for the domestic automakers. Even worse, a price war/incentive war is now going on within the segment which will further eat into the domestic’s profits. The other problem is that most Tundras on the road are 5.7L models, and that will slowly start to change perception among domestic truck buyers.
And with regards to Buick: 6 sales per dealer? I think they’ve hit a new low.
(The Aveo is just a zero (negative?) profit CAFE-mobile in a buy an Escalade and get an Aveo for free kinda way)
This is a common misconception. The way CAFE works is not only by manufacturer, but also by imported vs. domestic and by car or truck classification. For treaty reasons Canadian made vehicles count as domestic, and mexican made may as well. The Aveo comes from Korea and would only count against other imported GM cars. I don’t think GM imported enough GTOs from Australia to need many Aveo sales.
The really strange thing about the Aveo is that it’s fuel economy is practically the same as a 4 cylinder Malibu. The only reason to buy an Aveo is for it’s cheap purchase price. Fuel economy wise it is hardly best in class. EPA combined Aveo number is 28, Malibu 4 is 27, Cobalt is 27, Honda Civic is 34 … all for 2006 automatic transmission versions.
I’ll post graphs showing the comparative results along with data from the same time last year.
Oh boy, pictures!!!
I think part of the problem with the GMT900 trucks is that GM has conditioned people to expect huge rebates, and until the rebates increase to a high enough level, sales will be low. However, I think it is already starting to happen. In the D/FW area, I have seen ads for new Silverados with $7k off MSRP. That’s a huge rebate for a brand new truck.
I think that people are still expecting the $10k+ rebates that were around a year or two ago.
Whoa – Solstice at 98 days, down from 130? What up with THAT?
I find it quite possible that the Buick/Pontiac dealers are surviving mainly on their used car sales. I don’t think anybody who buys a used car really cares what kind of new car store the used department is attached to. An acquaintance once told me that when he was selling used cars, there was more profit to the dealer on used cars selling for $2-3K (which had been traded in for virtually nothing- maybe a few hundred bucks) than there was selling new cars for $30-40K. Consequentially, his commissions (determined by a percentage of the dealer’s profit) were actually higher for selling these beaters than when he had worked the new car side of the store- at a Lexus dealership, no less.
Used cars and the service department are where most new car dealers make their profits. The new car sales department is there mostly to prime the pump. The real profits in new car sales happen in the finance manager’s office where extended warranties, clear coat protectant, fabric protectant and the financing itself are all major profit makers. New car sales also provide the clean used car trade-ins which are bought cheaply from the customer. People who buy their cars new are also the best customers for dealer service departments.
Service profit margins are sky high with dealers now charging $80-$125 / hour “book rate” labor. 90% of the time the mechanics beat the book times, so the real per hour charges are higher yet. Parts markups are also strong, with many dealerships charging more than the already high mfg. suggested prices for parts. Few customers cross shop parts costs, especially when the dealership is installing the parts.
Almost all dealers lard extra services on top of the manufacturer suggested maintenance schedule, including pure profit items like “fuel system conditioners” and ultra high margin services like “power steering system flush”.