March 28, 2024

Car Sales Continue Their Climb

General Motors, the largest of the Detroit auto companies, said it sold 194,000 cars and trucks during the month, a 15.9 percent increase over the same period a year ago. The company said all four of its brands — Chevrolet, Cadillac, GMC and Buick — had double-digit increases in January.

G.M. also rebounded from tepid sales of its core pickup trucks in recent months. The company said sales of its Chevrolet Silverado pickup increased 32 percent compared to January 2012, and sales of the GMC Sierra improved 35 percent.

“The year is off to a very good start for General Motors,” said Kurt McNeil, head of G.M.’s United States sales operations. “There’s a sense of optimism among our dealers that only comes when you pair a growing economy with great new products.”

Last year, the overall American auto industry had its best performance in five years with sales of 14.5 million vehicles — a 13 percent increase over 2011.

Automakers and industry analysts are forecasting sales this year to be as high as 15.5 million vehicles. The optimistic projections were in part because of a growing need by consumers to replace aging vehicles, as well as improvements in the economy.

Ford Motor Company, the second-biggest of the Detroit automakers, said its sales in January rose 21.8 percent to 166,000 vehicles.

Ford reported that its passenger cars did particularly well, with an increase for the month of 34.1 percent. Sales of the recently redesigned Ford Fusion midsize sedan increased 64.5 percent.

Executives at Ford said the company expects consumer demand to consistently grow in 2013.

“The biggest driver of the year is going to be replacement,” said Ken Czubay, Ford’s United States sales and marketing chief.

Chrysler, the smallest American car company, said it sold 117,000 vehicles in January. That was a 16.3 percent increase over the same month in 2012, and extended Chrysler’s year-over-year sales gains to 34 consecutive months.

Chrysler said sales of cars rose about 50 percent during the month, while sales of SUVs and trucks increased by 3 percent. Its new small car, the Dodge Dart, had its best performance since being introduced last summer, the company said.

Toyota, the largest Japanese automaker, said its sales in January grew 26.6 percent to 157,000 vehicles.

Article source: http://www.nytimes.com/2013/02/02/business/car-sales-continue-their-climb.html?partner=rss&emc=rss

Car Sales End Strong Year on Modest Note

Based on early reports Thursday, analysts predicted a 10 percent increase overall for the industry for December, a gain that would put the year’s sales at about 14.5 million – the best performance since 2007.

The three Detroit car companies all posted sales gains in December, solidifying improvements made throughout year because of consumers replacing their aging cars and trucks.

General Motors, the largest American automaker, said its December sales increased 4.9 percent, primarily because of new products such as the Cadillac ATS sedan and higher incentives on its Chevrolet Silverado and GMC Sierra pickups.

The company had been losing ground in the high-profit pickup truck segment until it added discounts to the Silverado, which posted a 6.1 percent sales increase in December, and the Sierra, which was up 13.4 percent.

For the year, G.M. sold 2.59 million vehicles, an increase of 3.7 percent from 2011. That lagged the overall gains in the market, which were about 14 percent industrywide for the year.

G.M.’s head of United States sales, Kurt McNeil, said the company expects significant growth in 2013, with industry sales as high as 15.5 million. He noted that the resolution of fiscal negotiations in Washington removed some potential concerns for consumers shopping for new vehicles.

“We are especially pleased that the politicians on both sides of the aisle in Washington were able to compromise,” Mr. McNeil said in a conference call with analysts and media Thursday. “The short-term crisis has passed.”

Ford Motor Company reported a slight sales increase of 1.9 percent in December as safety recalls for its new Escape SUV and Fusion sedan depressed results.

Ford said that sales of the Fusion dropped 10.8 percent during the month and Escape sales slid 21.3 percent. The company has been plagued with multiple recalls on engines and other parts on the vehicles, which are usually among its strongest sellers.

The drop was mitigated by strong results for Ford’s two smallest cars, the Focus, which increased in sales by 58.3 percent, and the Fiesta, which was up by 52.8 percent.

For all of 2012, Ford’s United States sales increased 4.7 percent to 2.25 million vehicles. Ken Czubay, head of Ford’s domestic sales and marketing, said the company’s small-car sales were its best in more than a decade.

Ford predicted that industry sales in 2013 could reach 16 million vehicles, as more Americans replace older models with new, more fuel-efficient ones.

Chrysler, the smallest of the Detroit companies, was again the star performer in December, with a 10 percent increase.

The company’s new compact car, the Dodge Dart, showed improvement with a 36 percent gain from the prior month. In fact, much of Chrysler’s lineup – ranging from Jeep SUVs to the tiny Fiat 500 micro-car – posted sales records for the month of December.

For the year, Chrysler sold 1.65 million vehicles, a 21 percent increase from 2011.

The major foreign automakers were expected to report results later in day. In a partial report, Toyota, the biggest of the Japanese manufacturers, said that it sold 2 million vehicles in the United States during 2012, a 26.6 percent increase from the year before.

Article source: http://www.nytimes.com/2013/01/04/business/car-sales-end-strong-year-on-modest-note.html?partner=rss&emc=rss

News Analysis: In Rally Over Euro Deal, Relief Mixed With Wariness

The positive sentiment was reinforced by a report that the United States economy had grown at an annual rate of 2.5 percent in the third quarter, the best performance in a year, adding to confidence that the United States will not experience a double-dip recession and prompting investors to put some of their long-dormant cash to work.

But even amid the surge in stock markets worldwide, there were reservations in some quarters. The response in the European debt markets, the epicenter of the crisis, was muted, with little relief reflected in the interest rates that Spain, France and Italy must pay on their bonds. There has been concern, in particular, that Italy’s huge accumulated debt might be the next focus of a bailout effort.

The plan agreed to by European leaders in Brussels early Thursday, the subject of weeks of contentious bargaining, has three main planks: an effort to recapitalize weak euro-zone banks, an increase in the size and scope of Europe’s main rescue fund, and a proposal that banks take a 50 percent write-down on their Greek bonds.

It was the latest in a series of gatherings over the last year seeking to keep the sovereign debt problems of Greece and other vulnerable European nations from radiating through the financial system on the continent and beyond. Each meeting seemed to head off an immediate crisis, only to prove insufficient within months or weeks and prompt a new search for solutions.

And as always with the grandly presented European rescue plans, the devil with the latest one is in the details. Despite Thursday’s exuberance, many investors expressed caution as to how the plan would hold up in the coming days and weeks.

For one thing, while the agreement by banks to write down 50 percent of Greek debt was welcomed, the deal’s success is conditioned on investors’ agreeing to take such a large loss. If a large number of investors refuse to accept such a loss, then the plan loses its voluntary status and would thus become a default — creating more unease and panic in the markets.

Moreover, private investors are not obliged to take the write-down, and two big holders of Greek debt, the International Monetary Fund and the European Central Bank, are not granting debt relief. So it is not clear how much of Greece’s overall sovereign debt of 340 billion euros ($480 billion) is going to be forgiven.

And it remains to be seen whether the debt relief for Greece will prompt other countries — Spain, Italy, Portugal or Ireland — to seek similar treatment.

Investors have also questioned whether the answer to the euro zone’s debt crisis is taking on even more debt.

The main bailout fund, the European Financial Stability Facility, relies on the sterling credit of Germany and France for its borrowing power. Euro zone leaders have promised to use the fund to both provide insurance for investors looking to buy risky Italian and Spanish bonds and to increase its borrowing capacity to as high as 1 trillion euros.

But it has been criticized as being too small and cumbersome and too reliant on France, which may well see its AAA rating taken down a notch because of its own debt and deficit problems. Such a move would hurt the vehicle’s ability to issue bonds and attract capital from investors.

It also remains unclear if Europe, as it has promised to do, would be able to entice Asian and Middle East investors to put money into   vehicles that would be linked to the bailout fund.  

Europe’s 106 billion euro answer for its bank problem may also raise more questions than it answers. In contrast to bank rescue plans in the United States and  Britain, European governments are not injecting funds directly into the banks. Instead they are asking that banks significantly raise their capital level, to 9 percent by next year. 

But for banks that have been weakened from their exposure to dubious European debt, raising money from private investors will be difficult — especially as many of the likely sovereign fund candidates are the ones that suffered deep losses from investing in troubled American banks in 2007 and 2008.

All in all, despite the relief that an immediate crisis over Greece’s debt had been averted, it seemed clear that the continent’s tightly woven economic and financial systems remained fraught with risk.

The yield on Italy’s 10-year bond, which recently hit a high of 6 percent on concern over the country’s debt and commitment to fiscal reform, remained uncomfortably high at 5.8 percent. And the interest rates for Spanish and French bonds narrowed only slightly as well, reflecting a broader skepticism that this plan will provide a magic cure for Europe’s debt problems.

This article has been revised to reflect the following correction:

Correction: October 27, 2011

Because of an editing error, an earlier version of this article referred imprecisely to United States economic growth in the third quarter. The 2.5 percent figure represents an annual rate.

Article source: http://feeds.nytimes.com/click.phdo?i=e23087b7dbc38a8044d130ad21300ac9

Sprint Nextel’s Losses Narrow as It Gains Subscribers

Sprint also provided important updates on the iPhone, its financing needs and planned network upgrades, undoing some of the damage caused by an investor day presentation three weeks ago that had investors fuming and sent its stock plunging.

Its shares still edged lower on Wednesday as investors continued to focus on finances that look precarious for the next two years.

Sprint’s net loss was $301 million, or 10 cents a share, for the third quarter. That is down from $911 million, or 30 cents a share, a year ago. It was the best performance by Sprint since it reported a profit of $64 million in the third quarter of 2007.

Revenue rose 2.2 percent to $8.3 billion.

Sprint, the country’s third-largest wireless carrier behind ATT and Verizon Wireless, said it added a net 1.3 million subscribers in the July-to-September period, the best result since 2006. Sprint continued to lose subscribers from its lucrative contract-based plans, but at a relatively low rate: 44,000 in the quarter. Sprint’s total customer count, 53.4 million, is now back at where it was in 2007, before the exodus of Nextel customers turned into a torrent.

The company, based in Overland Park, Kan., has made steady gains in the last year and a half. Unfortunately for the company, most of the new customers are low-paying ones. They buy service from Sprint’s low-cost Virgin Mobile, Boost Mobile or Assurance Wireless brands, or from non-Sprint brands that use the company’s network.

The latest subscriber results do not include the effect of the iPhone, which Sprint started selling Oct. 14. The phone is expected to further improve the company’s ability to keep customers, at a high price. Apple charges about $600 for a phone that Sprint sells for $200.

Sprint’s chief financial officer, Joseph J. Euteneuer, said each iPhone would cost the company about $200 more than another smartphone. All the same, the company expects its four-year purchasing agreement with Apple to add $7 billion to $8 billion to its own bottom line.

The problem for Sprint is that the cost of selling the iPhone comes upfront, while benefits like higher service fees and lower service costs accrue over time. Sprint does not expect the iPhone to be a moneymaker until 2014.

The added cost of the iPhone comes as Sprint is also starting to revamp its network for higher speeds. That adds up to financing needs of $5 billion to $7 billion in the next few years, Mr. Euteneuer said.

Shares of Sprint fell 19 cents, or 7 percent, to $2.51.

Article source: http://feeds.nytimes.com/click.phdo?i=1ff1e6f83cb31fb12cd81f939da49b60

Tiffany’s Net Income Rises 30 Percent

Tiffany Company’s net income rose 30 percent in the second quarter, propelled by strong growth across all regions as high-income shoppers continued to be drawn to its jewelry and other goods.

The results handily beat Wall Street’s expectations, and the company raised its full-year profit forecast again as a result. Tiffany said it earned $90 million, or 69 cents a share, in the quarter, up from $67.7 million, or 53 cents a share, a year earlier.

Excluding 16 cents a share in costs tied to relocating its New York headquarters employees, adjusted profit totaled 86 cents a share, topping the 70 cents that analysts surveyed by FactSet had forecast.

Revenue in the period, which ended July 31, rose 30 percent to $872.7 million, which was well above the $785.6 million that Wall Street predicted.

Stock in Tiffany rose $5.90, or 9.3 percent, to $69.01 a share.

Mark L. Aaron, vice president for investor relations, said in a conference call that sales across all jewelry categories rose more than 10 percent.

High-end, engagement and gold jewelry all sold well, Mr. Aaron said. Silver jewelry, which sold well during the recession since it is relatively lower priced, posted a “reasonably good” sales increase, he added.

Rising diamond and precious metal costs have prompted Tiffany to raise some prices. Mr. Aaron said the price increases had occurred in most regions this year.

The chief operating officer, James N. Fernandez, said rough diamond prices had climbed nearly 40 percent in the last year.

“The outlook for diamonds over the long term certainly looks as though rising global demand will continue to put pressure on supply and therefore price,” he explained.

Tiffany’s best performance in the quarter came in the Asia-Pacific region, where sales surged 55 percent to $173.2 million on strong performances in China and Korea. Sales in Europe rose 32 percent. Foreign tourists, particularly those from China and Russia, contributed to the increase in Europe, the company said.

Sales in the Americas, which comprises the United States, Canada and Latin America, gained 25 percent.

Sales at the company’s flagship New York store, a favorite of foreign tourists, rose 41 percent, Mr. Aaron said.

Even Japan, which is still regaining its footing after an earthquake, tsunami and nuclear scare earlier this year, posted a 21 percent sales increase.

“We are extremely pleased by these results, which confirm the growing global appeal of Tiffany’s product offerings,” the chief executive, Michael J. Kowalski, said in a statement.

Revenue at stores open at least a year increased 22 percent. Mr. Kowalski said the retailer’s first-half performance raised confidence about the rest of the year, even though economic uncertainty remained.

Tiffany is now predicting that its full-year earnings will be $3.65 to $3.75 a share, compared with a previous forecast of $3.45 to $3.55 a share.

Analysts foresee earnings of $3.55 a share.

Article source: http://feeds.nytimes.com/click.phdo?i=b299747b945d86f412ad932a5d0cd881