Sunday, September 20

Incentives fuel 24 per cent jump in US auto sales

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CHICAGO: Tempting incentives fueled a 24.3 per cent jump in US auto sales in March after Toyota set off a price war as it wooed customers spooked by a series of mass recalls, industry data showed Thursday.

SALES UP: A man looks at the underside of a Ford Mustang displayed on its side at the New York International Auto Show in New York. Ford said its US sales rose 43 per cent in March amid signs of a broad recovery as every brand and every category recorded higher sales. — AFP photo

SALES UP: A man looks at the underside of a Ford Mustang displayed on its side at the New York International Auto Show in New York. Ford said its US sales rose 43 per cent in March amid signs of a broad recovery as every brand and every category recorded higher sales. — AFP photo

Total industry sales rose to a seasonally adjusted annualised rate of 11.78 million units from 9.72 million units in March 2009 and 10.38 million units in February, according to Autodata.

Sales for the first three months of the year were up 15.5 per cent from a year earlier.

“Incentives helped lift sales to its highest level since (the government-financed) Cash for Clunkers programme spurred sales in August,” said Jessica Caldwell, director of industry analysis for automotive website Edmunds.com.

“And this month will be the highest ever for average combined incentive spending for Japanese automakers, including a record high month for Toyota.”

Toyota’s rare offer of zero per cent financing and up to US$3,000 cash back helped boost its sales by 40.7 per cent to 186,863 in March.

The troubled Japanese automaker also managed to regain the number two spot from Ford as its US market share rose to 17.5 per cent in March from 12.8 per cent in February, according to Autodata. “Toyota’s strong sales performance in March reflects our customers’ continued confidence in the safety and reliability of our vehicles and their trust in the brand,” said Don Esmond, senior vice president of automotive operations for Toyota Motor Sales USA.

“We are standing by our cars, and we’re grateful that our customers are standing by Toyota.”

Ford, however, expressed satisfaction that it was able to boost its sales by 43 per cent to 178,546 vehicles even as its incentive spending shrank and the average transaction price of its vehicles rose.

Its market share of 16.7 per cent was off by 0.9 points from February but was up 2.2 points from March 2009, according to Autodata.

“Ford’s plan is working,” said Ken Czubay, Ford vice president for US marketing, sales and service.

“People increasingly are discovering that the Ford difference is the strength of our fresh, new product lineup, especially our leadership in quality, fuel efficiency, safety, smart technologies and value.”

Sales at GM’s four remaining core brands rose 43.3 per cent to 185,406 in March while its overall sales were up just 20.6 per cent as a result of the wind-down and sale of Hummer, Pontiac, Saturn and Saab.

Its US market share was down 0.4 points from a year earlier at 17.6 per cent.

GM is “pretty encouraged” by its results and has managed to bring its incentive spending down below the industry average for the first time on record, said Susan Docherty, GM vice president of marketing.

It has also raised the average transaction price as it focuses on “earning the customer’s trust rather than buying their business for short-term gain,” Docherty said in a conference call.

Chrysler’s troubles deepened as its sales fell 8.3 percent to 92,623 vehicles and it slipped to sixth position as its share fell to 8.7 per cent from 11.8 percent in March 2009 and 10.8 per cent in February. — AFP