| Spreading the word
Detroit, July 2 (Reuters): Big consumer incentives delivered blockbuster results for General Motors Corporation in June, with its US sales jumping 41 per cent over the same month last year, largely at the expense of Detroit-based rivals.
Ford Motor Company, the number two US automaker, lost the most market share as it posted its thirteenth consecutive month of lower US vehicle sales. Like GM, Ford is also struggling to stop bleeding money in its core operations.
Japan’s Toyota Motor Corporation and Nissan Motor Corporation also posted double-digit gains, and Toyota said its first-half sales were the best ever in 48 years of doing business in the United States.
Nissan said its US sales were up 14 per cent in June. Toyota, meanwhile, revealed its US sales rose 10 per cent over June 2004 and Honda Motor Company Ltd said its sales were up 4.7 per cent.
The stronger-than-expected increase at GM was driven by steep discounts that could hurt its bottom line. But it gave temporary relief to the world’s largest automaker, boosting GM’s market share and offsetting sales declines that contributed to a $1.1 billion first-quarter loss.
It was the company’s strongest sales month since September 1986, and GM said it set an all-time industry record for light truck sales, which were up 68 per cent.
The company’s deals lured customers away from the showrooms of Ford and others, including the Chrysler unit of Germany’s DaimlerChrysler, analysts said.
“GM took sales from everybody with this programme of theirs but I think they took most of it from Ford and Chrysler,” said David Healy of Burnham Securities.
“GM stole the month with the programme,” he added, referring to GM’s “Employee Discount for Everyone” incentives strategy.
The increase in GM’s sales of light trucks bucked a worrisome trend for US automakers, which have recently seen sales of large, fuel-thirsty vehicles slump dramatically in the face of rising US gasoline prices.