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Cruze sales down for the month, up for the year



Published: Thu, September 4, 2014 @ 12:08 a.m.

GM’s retail deliveries took biggest hit in Aug.

By Kalea Hall

khall@vindy.com

DETROIT

It was said to be the best car-selling month in eight years, yet General Motors Co. fell short in sales, down 1.2 percent from last August.

Sales of the Lordstown-built Chevrolet Cruze fell 2 percent from last year, but they’re still up 3.6 percent for the year in the tough, competitive compact-car market.

Glenn Johnson, president of United Auto Workers Local 1112, thought the delivery of 23,435 Cruzes in August was fantastic. Last August 23,909 were sold. The Cruze did see an increase of 23 percent in retail deliveries, according to GM.

“I am not too concerned,” Johnson said. “Things run in cycles. All I can really be concerned about is what is in front of us and what we are doing.”

The new 2015 Cruze is expected to roll out soon and will have upgrades and a fresh look that “will keep it fresh in the customers’ eyes,” said Johnson, whose union works at the Lordstown complex.

The Cruze faces some tough competition, not only in its compact-car market but with SUVs and trucks. GM saw an increase of 18 percent in truck sales compared with a year ago.

“What we are seeing are the SUVs, especially midsize, are red-hot, and they are coming at the expense of the passenger cars,” said Eric Lyman, vice president of industry insights for TrueCar. “If you look at the GMC brand, they had a pretty good month.”

Karl Brauer, senior analyst for Kelley Blue Book, said many people never thought consumers would go back to buying larger vehicles, but today those SUVs get better mileage and provide increased flexibility.

“Compact cars are nice, [but when you drive one] you are looking like someone who had to buy a compact car,” Brauer said.

Brauer did think the number of Cruze sales this year was strong given the competitive market.

“[The 2015 Cruze] will help it maintain competitiveness,” Brauer said. “I think they will be under pressure for the foreseeable future.”

The increase in sales across the auto market is attributed to a pent-up demand, combined with good credit options, incentives and favorable financing.

Chrysler and Nissan led the way with double-digit sales increases, while Toyota reported sales were up 6 percent. Ford and Honda sales each rose 0.4 percent, and Hyundai saw a 6 percent gain. Of major automakers, only GM and Volkswagen posted declines, with struggling Volkswagen off almost 13 percent from a year ago.

Chrysler, GM and Ford all predicted an annual light-vehicle selling rate for the month of around 17.2 million, the highest number since August 2006.

GM delivered 272,423 vehicles in August.

Retail deliveries for GM declined 4 percent, and fleet deliveries were up 9 percent.

Brauer believes the GM sales were down because of GM’s discipline with incentives, which means GM has higher earnings for transaction prices.

“The not-so-good news is that much of its sales were fleet-dependent in August, while overall sales were down slightly for the month,” Brauer said. “This comes as competitors like Chrysler and Ford are experiencing strong consumer demand and overall sales growth.”

The AP contributed to this report.


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