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Aided by Sandy, Cruze sales rise again

Published: 12/4/12 @ 12:10


By Burton Speakman

bspeakman@vindy.com

LORDSTOWN

Sales of the Chevrolet Cruze were up 27 percent in November, continuing a string of four-consecutive strong months for the Lordstown-built vehicle.

The purchases this month were aided by a natural disaster, General Motors officials said.

There were 16,807 Cruzes sold in November compared with 13,238 in November 2011. Early in 2012, sales of the Cruze were well behind the 2011 pace, but bounced back in August and September, which were two of the strongest sales months in the vehicle’s history.

For the year, sales of the vehicle are at 216,528, up from 215,057 through the end of November 2011.

General Motors acknowledged that people purchasing new vehicles to replace those damaged in Superstorm Sandy did help with November sales, said Kurt McNeil, vice president of U.S. sales operations.

“It benefited our competitors more than GM, since they rely on the region for more of their sales,” McNeil said.

Honda and Toyota are the best-selling models in the areas affected by Sandy, according to Truecar.com and Edmunds.com, two automotive information websites.

GM has the ability to increase marketing and increase sales along the coasts, said Kristen Andersson, senior analyst for Truecar.com,

The sales demand for the Cruze is good enough that current trends should continue for the next few months, Andersson said.

It’s impressive for Cruze sales to be above last year’s pace due to the supply problems for the Japanese automakers in 2011 due to the tsunami, Andersson said.

“They’ve been able to keep sales pace and do it while spending less on incentives than either Honda, Toyota or Ford [on comparable models],” she said.

Typically this of time of year when sales for smaller vehicles like the Cruze decrease, sales of trucks and SUVs go up, said Jessica Caldwell, senior analyst for Edmunds.com.

“There doesn’t appear to be much of that this year,” she said.

The Cruze is part of the group of smaller, fuel-efficient vehicles from GM that have been effective in attracting younger buyers, McNeil said.

Overall, GM reported the company’s highest November sales in the United States since 2007. Deliveries were up 3 percent versus a year ago.

Retail purchases were roughly equal to a year ago, and sales to fleet customers increased by 16 percent.

“It’s clear that the industry will come in at the high end of our full-year sales forecast,” McNeil said.

“Exactly how much growth we can expect next year will depend in part on how Congress and the president resolve the fiscal-cliff issue. Consumers hate uncertainty, so an agreement on ways to reduce long-term federal budget deficits could remove an impediment to growth,” he added.

The company is expected to be on the high end of sales projections for the year but is not expected to reach GM’s goals for smaller inventory, he said.

The company could consider reducing production to meet inventory goals.

In December, the next sales month, the expectation is that GM will increase its advertising and incentives in order to increase its sales compared to foreign competition, Caldwell said. GM truck sales are down, and overall while sales have increased, they are not as high as foreign competition.

“Right now things are about the big headline, and GM does not want consumers and investors to perceive that GM had a negative month two months in a row,” she said.