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Auto Sales, Led by Trucks, Jump in May

June 3, 2013 by Leave a Comment

But in the world of the postbailout auto industry, that firmament has gradually shifted, as Ford has introduced appealing fuel-efficient models while G.M. has contracted, dropping brands and reducing capacity.

On Monday, Ford continued to chip away at its rival, reporting a robust 14 percent gain in American sales in May, to 246,000, about 6,000 behind G.M., which reported a tepid 3 percent gain. Chrysler reported an 11 percent sales increase, to more than 166,000, beating analyst expectations.

The strong performances by Ford and Chrysler helped the overall industry to stay on track to sell more than 15 million vehicles this year for the first time since 2007, before the financial collapse that sent carmakers into a tailspin. All automakers combined to sell 1.44 million new vehicles in the United States in May, an 8.2 percent gain over the same month in 2012.

“The industry is settling into a healthy place where supply and demand are meeting,” said Jessica Caldwell, an analyst with the auto research site Edmunds.com, “but demand is still growing. We’re edging our way into what would be the sweet spot for sales.”

Now demand is driving supply, with Ford, Chrysler and Toyota adding more production and more jobs at United States plants to capture sales momentum. On Monday, Ford announced plans to increase capacity by 10 percent, to 740,000 vehicles, in the third quarter, as it strives to meet increasing demand for its S.U.V.’s and midsize passenger cars.

Ford’s sales increase was driven not only by continued strong demand for large pickups and sport utility vehicles but also by rising sales of its smaller models, like the Fusion, Focus and Fiesta. Sales of the automaker’s Fusion midsize sedan, for example, rose 10 percent, to 29,553 vehicles, for its best May ever.

Ford also reported strong sales of its Escape utility vehicle, which also had its best month ever, and the Lincoln MKZ, which soared 42 percent for its best May on record.

G.M., by contrast, continues to struggle in some major passenger car categories even as other segments like trucks remain strong. Its passenger car sales slipped 6.4 percent, in part because of a 31.7 percent decline for its full-size Chevrolet Impala and a 36.1 percent drop for its Chevrolet Malibu midsize sedan. Its Buick LaCrosse, down 15.2 percent in May, and Regal, down 37 percent, also struggled.

In a sign of G.M.’s urgency, on Friday it unveiled a refreshed version of its Malibu, only a year after introducing a revamped model.

G.M., which sold 253,000 vehicles in May, did have success in its smaller cars, maintaining sales for its midsize Chevrolet Cruze while introducing the smaller Chevrolet Spark and Sonic models.

“It’s not necessarily saying G.M.’s performance was bad, because it wasn’t,” Ms. Caldwell of Edmunds.com said. “It was just that Ford was better. Ford has a balance in their portfolio, while G.M. is a little more hit or miss.”

The strongest sales across the industry remained in pickups and S.U.V.’s, which rose 10.9 percent to 718,890 vehicles in May, in contrast to a 5.7 percent increase in car sales, to 725,736 vehicles.

Sales of Ford’s F-Series rose 30.6 percent, while Chrysler’s Dodge Ram truck brand climbed 21.6 percent. At G.M., large pickup truck sales rose 23 percent, accompanied by a 25.3 percent gain for its Chevrolet Silverado truck, the country’s No. 2 best-selling vehicle with 43,283 units sold.

The 19.2 percent rise in pickup truck sales continues to reflect strong marketplace demand after a recovery in the housing market and a surge in the construction and oil industries. Automakers also cited an aging fleet of pickups and pent-up demand.

“Quite simply, it’s a great time to be in the truck business,” said Kurt McNeil, head of General Motors sales operations in the United States.

Several foreign automakers also reported double-digit sales increases, including a 24.7 percent gain for Nissan, driven by price cuts on seven of the Japanese automaker’s vehicles and the popularity of its Sentra and Altima models.

Mazda reported gains of 19.2 percent, and Subaru of 34.2 percent.

Toyota, the world’s largest automaker, lagged competitors with a 2.5 percent increase, in line with expectations.

For both Toyota and G.M., “the marketplace has become so competitive in their bread-and-butter segments,” said Alec Gutierrez, senior analyst at Kelley Blue Book.

Article source: http://www.nytimes.com/2013/06/04/business/auto-sales-led-by-trucks-jump-in-may.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Bucks Blog: Friday Reading: To Elf (on the Shelf), or Not

December 7, 2012 by Leave a Comment

December 07

Friday Reading: To Elf (on the Shelf), or Not

To elf (on the shelf) or not, BMW recalls X5 sport utility vehicles, unused pills pose disposal risks and costs and other consumer-focused news from The New York Times.

Article source: http://bucks.blogs.nytimes.com/2012/12/07/friday-reading-to-elf-on-the-shelf-or-not/?partner=rss&emc=rss

Filed Under: Your Money Tagged With: ,

China Imposes New Tariffs on Some Vehicles From the U.S.

December 14, 2011 by Leave a Comment

GUANGZHOU, China — The Chinese government increased trade tensions with the Obama administration Wednesday evening by unexpectedly imposing antidumping and antisubsidy tariffs on imports of sport utility vehicles and midsize and large cars from the United States.

The new tariffs, totaling up to nearly 22 percent of the import prices, will probably have a mainly symbolic function, rather than reducing the already skimpy sales of such vehicles in China. Other tariffs and taxes already in place have limited sales of American imports by helping raise their retail prices by about three times what the same cars and S.U.V.’s sell for in the United States.

Still, firing a trade volley at American exports of automobiles, one of the most politically sensitive industries in international trade, can only escalate trade hostilities between China and the United States.

China’s move drew immediate criticism from the Obama administration.

“We are very disappointed in this action by China,” said Carol Guthrie, a spokeswoman for the Office of the United States Trade Representative. “We will be discussing this latest action with both our stakeholders and Congress to determine the best course going forward.”

The Commerce Ministry of China, which has conducted a two-year trade investigation of the American imports, gave no explanation for its decision to impose the duties. Ministry officials could not be reached for elaboration Wednesday evening.

The duties would mainly affect General Motors, which exports Cadillac S.U.V.’s and cars to China; Chrysler, which exports Jeeps; BMW Group of Germany, which exports BMW S.U.V.’s from South Carolina; and Daimler of Germany, which exports Mercedes S.U.V.’s from a factory in Alabama.

Because of the high Chinese tariffs and taxes already in place, the vehicles are sold only in the thousands or even hundreds in China, and only to the most affluent. (A Jeep Grand Cherokee that begins at $27,490 at dealerships in the United States costs $85,000 or more in China.)

The White House announced last week that it would ask the World Trade Organization next Monday to open an investigation into Chinese restrictions on imports of American broiler chickens.

More significantly, Chinese government agencies and companies have been furious about a current American investigation into whether Chinese exports of solar panels to the United States might have received illegal subsidies or been dumped in the American market at prices below the cost of manufacturing them.

American officials have previously examined the methodology of China’s two-year-old antidumping and antisubsidy investigation of American-made automobiles and have found “significant problems,” said Ms. Guthrie, the United States trade spokeswoman.

One challenge for China, which recently celebrated its 10th anniversary as a member of the World Trade Organization, is whether Wednesday’s action will be allowed under W.T.O. rules.

The trade organization places many limits on a member nation’s ability to impose antidumping and antisubsidy measures, particularly on goods from countries that the W.T.O. has declared as having market economies, like the United States.

“Dumping” might be hard to demonstrate, given that the prices of the American vehicles — even before China’s tariff and tax mark-ups — tend to be higher than in the United States.

The Chinese accusation of subsidies may be linked to previous comments by Chinese officials questioning whether the Obama administration provided too much federal assistance to G.M. and Chrysler two years ago during the global financial crisis.

China started the automotive trade case after President Obama imposed steep tariffs on surging imports of Chinese tires in September 2009. After a lengthy inquiry, the W.T.O. ruled this autumn that the American tariffs on tire imports had complied with international trade rules.

The new tariffs China imposed Wednesday will be antidumping duties of 8.9 percent for G.M. vehicles, 8.8 percent for Chrysler, 2.7 percent for Daimler and 2 percent for BMW.

The ministry separately imposed additional antisubsidy duties of 12.9 percent for G.M. and 6.2 percent for Chrysler.

Article source: http://www.nytimes.com/2011/12/15/business/global/china-imposes-new-tariffs-on-some-vehicles-from-the-us.html?partner=rss&emc=rss

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China Carmakers Told to Seek Fuel Efficiency, Not Sales

September 5, 2011 by Leave a Comment

A succession of government officials at a weekend conference called for China’s automakers to shift their focus from making ever more cars and toward producing more fuel-efficient and more advanced models, including gasoline-electric hybrids and all-electric cars.

“The government must take the leading role in controlling unrealistic growth” of the auto industry, Jiang Kejun, the influential director of the Energy Research Institute at the National Development and Reform Commission, China’s top economic planning agency, said Sunday during a speech at the conference.

Lu Shize, director of air pollution control at the Ministry of Environmental Protection, echoed Mr. Jiang, saying that “for the auto industry to develop, we should not try to sell more, but to improve the units sold.”

The government officials did not say how they would restrict growth. But growth has already slowed partly because of limits on the number of new cars that can be registered each month in Beijing, and mostly because government incentives expired at the start of this year. Those incentives were subsidies for rural buyers and a two-year reduction in the sales tax on new family vehicles.

The officials’ remarks strongly suggested that the Chinese auto industry’s lobbying for the reinstatement of the incentives would fail and that restrictions on registering new cars would be extended to more cities.

Any slowdown in growth is likely to shock the world’s automakers. Practically every American, European, Japanese and South Korean automaker is expanding in China, including General Motors, Ford Motor, Nissan Motor and PSA Peugeot Citroën. Chinese automakers are building assembly plants even faster.

Years of double-digit expansion have increased Chinese auto production to almost 17 million cars, minivans, pickup trucks and sport utility vehicles last year, from fewer than two million in 2000, making it almost twice the size of the United States or Japanese industries and far larger than any European country’s auto manufacturing sector.

Growth in China culminated in a burst of sales in 2009 and 2010 as the government cut taxes on car sales to stimulate the economy during the global economic downturn.

J.D. Power Associates, the global consults, estimated last month that China would have a manufacturing capacity of 31 million vehicles by 2013. Yet the domestic market has decelerated sharply this year, with sales of family vehicles up just 5 percent in the first seven months, compared with the period a year earlier. By contrast, sales had soared 33 percent in 2010, compared with 2009.

Much slower sales growth this year has prompted strong lobbying by the auto industry for a renewal of government incentives. But if anything, policy makers seem to be leaning toward more limits to address China’s steeply rising dependence on imported oil and its traffic jams, air pollution and shortages of land in many areas for more road construction.

Officials in Beijing have urged the auto industry to improve technology for years. But they clearly shifted their tone at the conference this weekend in calling for curbs on the industry’s overall growth in sales and production.

Many Chinese automakers are partly or entirely owned by municipal or provincial governments, however, and these lower tiers of government have pushed their manufacturers to expand as fast as possible to maximize jobs and economic output.

But limits on car sales in big cities may pressure Chinese automakers to slow down. The municipal government of Beijing, China’s largest single market with 4 percent of sales last year, stunned the industry last December by imposing stringent limits on the number of new-car registrations each month, effectively imposing a decline in sales of close to 70 percent.

Industry executives argued that this was purely a response to severe traffic jams in Beijing and lobbied for the central government not to let other cities take the same course.

Article source: http://www.nytimes.com/2011/09/05/business/global/china-changes-direction-on-car-sales.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,