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Cruze sales down 50 percent compared to a year ago



Published: Wed, October 2, 2013 @ 12:01 a.m.

photo

A Chevrolet Cruze on sale at Sweeney Chevrolet in Boardman on Tuesday.

By JAMISON COCKLIN

jcocklin@vindy.com

LORDSTOWN

Sales of the Lordstown-built Chevrolet Cruze hit an all-time low in September, when they tumbled by 50 percent from a year earlier.

It was the worst month in its three-year history, other than the three months after its launch in 2010.

The figure had analysts scratching their heads when General Motors reported sales Tuesday.

September was the second-straight month of sales declines for the Cruze. In August, sales slid by 8 percent.

Last month’s data, however, marked the first time since January that Cruze sales dipped well below the 20,000 mark — a number auto analysts generally view as favorable regardless of any sales increase or decrease.

The Cruze sold 12,730 units last month, down by 50.6 percent from 25,787 a year earlier.

“I don’t know if you would ever expect that, especially after the car’s performance this summer,” said Tim Fleming, an analyst at Kelley Blue Book. “It certainly is worrisome. You don’t ever want to see the worst sales month in a vehicle’s history.”

Despite a slight drop in August, when the car still sold 23,909 units, the Cruze posted sales records from May through July. Included in that stretch was an all-time sales record in June with a 73 percent year-over-year increase.

Although September sales were dramatically low for the Cruze, it wasn’t entirely unexpected. Analysts and forecasting firms anticipated a dip in the U.S. auto market after sales surged through the first eight months of this year on pent-up demand, higher consumer confidence and improving economic conditions.

Sales fell at General Motors, Toyota, Nissan and Volkswagen in September, an odd month that appears likely to snap a longer 27-month streak of gains for the U.S. auto industry.

Labor Day weekend is typically strong for auto sales, and this year was no exception. But because the holiday came early, the auto industry counted all of that weekend’s sales in its August tallies, which cut into September’s numbers.

That hurt the Cruze’s September performance as well, said Jesse Toprak, a senior analyst at the automotive information website TrueCar.com. A number of other factors could have contributed to car’s sudden sales decline. too.

Toprak said GM “pulled way back on fleet and rental sales” last month. Not only does the Cruze sell heavily in that portion of the marketplace, but Ford and Chrysler, which both posted a sales increase last month, ramped up their fleet and rental sales. That also could help explain how those automakers nearly matched GM in sales volume last month.

What’s more, Toprak added, was a reduction in incentives such as financing deals that help sell the model each month. As the 2014 Cruze hits dealerships with lower incentives, GM has increased its offerings on the 2013 model to clear it off lots, creating what Toprak called a “balancing act” between the sale of both models.

Fleming said the Cruze’s competition was strong last month as well. The Toyota Corolla is all-new and Honda has a redesigned Civic on the market.

Combine that with strong U.S. small-car sales last month, a small dent in both demand and consumer confidence, and market conditions were less than stellar for the Cruze, analysts said.

Glenn Johnson, president of the United Auto Workers Local 1112 at Lordstown, who represents about 3,100 workers in the assembly plant, said even he was surprised by the Cruze’s decline.

“You sustain it for as long as you can. But there’s going to be months when the buying public is focused on other things and decides not to shop,” Johnson said. “I don’t see it as a trend, and I don’t think there’s anything to panic about — it’s just a hiccup.”

For the most part, analysts agreed with Johnson. Toprak and Fleming said it will be important to see how the car sells in the coming months, but September sales don’t indicate a downward trend.

Cruze sales are still up by 8.4 percent this year compared with last year. The model is GM’s second-best-selling vehicle this year.

September U.S. sales for all vehicles are expected to total around 1.1 million, according to the auto shopping site Edmunds.com. That would be a 4 percent decrease from last September and a 24 percent decrease from the blistering pace in August, which was the best month in more than six years.

The U.S. government shutdown could be the wild card that cuts into sales for the remainder of the year, but Jim Lentz, Toyota’s North American CEO, said the only way it would have an impact is if it causes credit to tighten.

Experts say all the factors that have been driving this year’s strong car sales — including low interest rates, the improving economy and the need to replace aging vehicles — remain in place. They see a strong close to the year with annual sales still projected to reach nearly 16 million vehicles.

The Associated Press contributed to this story


Comments

1author50(1121 comments)posted 1 year, 1 month ago

The economy has hit almost rock bottom. Everything is flat.

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2danikytn(248 comments)posted 1 year, 1 month ago

Maybe because of all the issues they have!!!!

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3Max(86 comments)posted 1 year, 1 month ago

Maybe because people are discovering the pieces of junk they are. My daughter bought one new 2 years ago. It has been a non-stop barrage of problems. Constantly at the dealer with another issue (some major.) And even though it's still under warranty, it's the inconvenience of having to deal with it. She's had to borrow a car several times to get to work while this lemon is back in service. A couple weeks ago she actually had to have it towed to the dealer -- the whole thing went completely dead. Thanks, but no more GM junk for us.

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4walter_sobchak(1949 comments)posted 1 year, 1 month ago

ALL models should be avoided in their first year or two of production until they get the design and manufacturing kinks worked out. I won't buy a GM product since they feel it is OK to give everyone a bouns while me, the taxpayer, has been left holding the bill. The US govt is still about $14B in the hole and will not recoup these funds. I just bought a Ford and love it!

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5Freeatlast(1991 comments)posted 1 year, 1 month ago

I did not know what some here are talking about . We have 8 of these cars for our salesman . And they have been great cars and our salesman seem to love them . Some have gone out and bought one for their family .

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6DwightK(1287 comments)posted 1 year, 1 month ago

"The figure had analysts scratching their heads"

And yet the rest of the article did a very good job of explaining why sales were down.

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7DACOUNTRYBOY(255 comments)posted 1 year, 1 month ago

When I get my Obama Voucher I'll help stimulate the economy and buy one. As soon as electric rates go up from generating plants being shut down then even the used car lots will be hurting. GM may have to start tooling to build bicycles, the affordable transportation.

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8rmzrez(129 comments)posted 1 year, 1 month ago

What a ^ss hole you are !!!!
You sure show why country boys are so stupid. Did you Mom sleep with her brother like all you county folks .
It is called interbreeding.
You can not fix stupid or incest . Witch are you county boy

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9kurtw(914 comments)posted 1 year, 1 month ago

Some of these comments are "lemons"- they ought to be sent back to the factory for re-tooling or improvement- like the one directly above me!

If cars were put together the same way some of the posters on this thread build sentences- we'd all be pedestrians!

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10rmzrez(129 comments)posted 1 year, 1 month ago

Right you must live in the COUNTRY

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11kurtw(914 comments)posted 1 year, 1 month ago

What's with the misspelling thing- e.g. "witch" for "which"- are you doing that to be cute or don't you know any better?

Incidentally (it may depend on your browser) but when I post, there's a spell check feature- handy to have: helps keep me from coming across as an illiterate. You might give it a try...

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12Silence_Dogood(1370 comments)posted 1 year, 1 month ago

" Witch are you county boy"
I am confused, a witch is female and flies around on a broom, and a country boy is just that, a boy.
How can someone be a boy and a female at the same time, is that some transgender thing that you are referring to.

I am in agreement with the big Lebowski, I will NEVER again buy a Government Motor car, Buy Ford, they don't go begging for free handouts.

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13Max(86 comments)posted 1 year, 1 month ago

@observant1,

First of all, this Cruze is not my first experience with a GM vehicle. I have owned a number of GM cars over the years, and have had less than good experiences with most of them.

Secondly, your comments (grammar, spelling, language, all caps, etc.) certainly says more about your intelligence and ignorance than mine, thank you.

And for your further information, read the following article published just today:

http://editorial.autos.msn.com/blogs/...

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14DACOUNTRYBOY(255 comments)posted 1 year, 1 month ago

Well rmzrez, I see in comment #11 that you have some mental issues that even the best psychiatrists in the country may not be able to resolve.

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15rmzrez(129 comments)posted 1 year, 1 month ago

Well county boy I see you may live in the country but you sure have Ytown class .

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16redgpgtp97(6 comments)posted 1 year, 1 month ago

They are still selling so what's the big deal.

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17richardlewis973(120 comments)posted 1 year, 1 month ago

gm cars are some of the worst quality cars on the road. cheap plastic and parts are used in construction and the dope head employees that put them together are worthless. i will only buy toyota

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18ytown_person1254(4 comments)posted 1 year, 1 month ago

When the Sub-prime auto loan market bubble burst you'll really see the sales plummet. 36% of all car loans are sub-prime. Consider that the sub-prime markets between 2nd qtr. 2009 and 2nd qtr 2013, rose 93%, from 10.8 Billion to 21.2 billion, explaining the initial increase in sales. BTW, 3.6% are delinquent 90 days or more. Also, China's economy is tanking, GM made 33.3 Billion in China in 2012, which is 22% of sales, and it doesn't seem like things are going to get better in China anytime soon. And, banks are bundling and dumping off these sub-primes loans so it is only a matter of time before that bubble burst.

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19NilesOhio(752 comments)posted 1 year, 1 month ago

There's a lot of GM bashing, but I'm very happy with our 2011 Cruze 2LT. It has been a rock-solid car so far. In fact, all the GM cars I have owned have been very good to me - my Sunbird had almost 300k miles when I sold it, my Saturn has 400k on it. I do maintain my cars very well, though.

I've had a 1996 Dodge Intrepid, and I haven't had nearly as many problems with a car as I have with that. It's absolutely horrible.

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20dontbeafool(1031 comments)posted 1 year, 1 month ago

I think it is the name. People associate it with a jacka$$ politician. lol

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