General Motors and Ford took another hit from slumping sales of large sport-utility vehicles (SUVs) in April, and the two largest automakers...
CHICAGO — General Motors and Ford took another hit from slumping sales of large sport-utility vehicles (SUVs) in April, and the two largest automakers again lost ground to major Asian rivals.
GM’s sales fell 4 percent and Ford’s nearly 2 percent for the month. Large SUVs, a principal source of profits for both, are down about 15 percent this year.
“There’s not much GM and Ford can do to correct their product offerings short term,” University of Maryland business professor Peter Morici said. “They’re married to large vehicles and big engines, and consumers just aren’t buying them right now.”
Toyota Motor Sales USA had its best month ever, selling 210,466 Toyota, Lexus and Scion vehicles. That’s 26 percent more than a year earlier.
Most Read Stories
- Road rage in Kent: Subaru strikes Jeep three times
- UW professor got it right on Trump. So why is he being ignored? | Danny Westneat
- Veteran LAPD officer arrested for sex with 15-year-old cadet
- The Amazon effect: Metro adds buses to handle new flock of summer interns
Toyota’s market share increased to 14 percent for the month, 2 points higher than a year earlier. GM’s share was 25.3 percent, 2.5 points lower than a year earlier, and Ford’s was 18.6, down from 20 percent last April.
Nissan North America’s sales gained 32 percent, to 91,621 vehicles, and American Honda’s were up 18 percent as both also posted their best April sales.
The Chrysler Group was the lone bright spot among domestics, with a 9 percent increase. That marked its 13th straight month of higher sales. Chrysler sold 206,546 vehicles, with strong demand for the Chrysler 300 sedan, minivans and the Jeep Grand Cherokee.
Including the Dodge and Jeep brands, Chrysler is up 7 percent for the year, to 753,278. Toyota’s sales are up nearly 14 percent, to 717,702.
Chrysler and the major Asian brands lifted industry sales to 1.5 million vehicles for the month, nearly 6 percent more than a year earlier, and, by all indications, the strongest April on record.
That didn’t stop the bleeding at GM and Ford, which have lowered their earnings forecasts in the face of sluggish demand for SUVs.
GM lost $1.1 billion in the first quarter, mainly from lower SUV sales. In April, the full-size Chevrolet Tahoe was down 34 percent and the Suburban 30 percent.
Overall, GM’s truck sales dipped 14 percent, offsetting an 11 percent gain in passenger-car sales. GM sold 380,535 vehicles for the month. Its sales this year are down 5 percent, to 1.38 million vehicles.
Paul Ballew, GM’s market analyst, called the company’s SUV sales “a little softer than what we anticipated” and blamed the decline more on the age of the vehicles than high gasoline prices.
GM plans to roll out new versions of its large SUVs early next year, and it is banking on them to revive sales.
But “with high gas prices, SUV sales are going to continue to lag,” Morici said. “GM is almost in denial on that issue.”
GM is reducing its second-quarter production by 10 percent, to 1.25 million vehicles, and trimming an unspecified number of SUVs, so it doesn’t have excess inventory of old models when the new ones arrive.
“We expected sales would be down this year,” Ballew said. The SUV slump also offset increases among passenger cars at Ford, resulting in its 11th straight month of year-to-year decline.
After years of decline, Ford’s car sales are up 1 percent this year. Mustang sales grew 26 percent in April, to 19,559, and the Five Hundred Sedan had its best month since it was launched last fall, selling 9,215.
George Pipas, Ford’s sales analyst, said the company’s SUV results would be lower if it hadn’t boosted sales to daily rental companies such as Hertz, a Ford unit.
Ford lowered its second-quarter production forecast April 20 by 5 percent, to 905,000 vehicles, and Pipas said SUVs would account for a large part of that cut.
Though Ford says gas prices have dented sales of the large, truck-based SUVs, Pipas said the growing number of car-based “crossover” SUVs, such as the Ford Freestyle and Escape, are taking a bigger bite.
Crossovers are up 15 percent, and Pipas predicted they could top traditional SUVs in sales as early as next year.
Weaker demand for SUVs and pickups has lowered Ford’s overall sales 4.3 percent for the year, to 1.04 million vehicles.
Chrysler said it will idle its Warren, Mich., truck plant for two weeks this month because of growing inventories of the Dodge Ram full-size pickup. Ram sales are down 8 percent this year.