June Cruze sales plummet 30 percent


By Jordyn Grzelewski

jgrzelewski@vindy.com

LORDSTOWN

The Chevrolet Cruze’s June sales plummeted more than 30 percent from last June, according to sales numbers released by General Motors.

GM delivered 12,828 Cruzes in the U.S. last month, compared with 18,666 in June 2016, a 31.3 percent year-over-year sales decrease.

“Cruze sales were bad,” Michelle Krebs, executive analyst for Autotrader, said Monday. “It’s a continuing story.”

Krebs attributed the sales decline to a “double whammy” – retail buyers’ continued preference for sport utility vehicles, and GM’s efforts to reduce its fleet sales.

Alec Gutierrez, senior analyst for Kelley Blue Book, highlighted a more-positive aspect of Monday’s report: Cruze sales to individual buyers.

Retail sales of the Cruze – including both the older and next-generation Cruze styles, as well as the Cruze hatchback – were up 3.3 percent year-over-year in June. The Cruze sedan is built at the Lordstown plant, and the hatchback is built in Mexico.

“The Cruze was heavily sold into rental,” he said, adding that GM’s strategy to reduce fleet sales has had a significant impact on the compact car. The Cruze’s fleet sales were down 76.2 percent last month compared with June 2016.

“But from a retail perspective, it’s holding its own and doing well compared to prior results,” Gutierrez said. “Consumers see the value of the vehicle.”

Year-over-year June retail sales for the older Cruze were down 95.9 percent, and year-over-year June retail sales for the new Lordstown-built Cruze were down 3.8 percent.

Another positive note for the Cruze was its sales for the first half of 2017, which were up 21.3 percent from the first six months in 2016.

The sales numbers’ release coincided with the start of a three-week layoff at the Lordstown plant. The layoff period is due to the sales slowdown.

Robert Morales, United Auto Workers Local 1714 president, declined to comment on the sales report but confirmed the layoff is continuing as planned. But, he said, the production line will stay at the same speed. Local 1714 represents fabrication workers at the Lordstown complex.

“There is no anticipation of a slowdown,” he said.

Krebs noted the Lordstown plant’s downtime and the cut of its third shift.

“I would not be at all surprised if we saw continued downtime at the Lordstown plant,” she said.

Overall, GM sales were down about 3 percent year-over-year last month, the company reported. Several other auto manufacturers released reports Monday.

In general, the reports highlighted consumers’ preference for crossover vehicles, SUVs and trucks.

Analysts said although the new-car market likely will not reach the record-setting sales from last year, the market is doing well. Krebs called this a “post-peak phase,” a reference to the U.S. auto industry’s record 17.55 million new vehicles sold last year.

“We’ve seen the industry maintain a relatively strong performance overall,” Gutierrez said.

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