DETROIT – General Motors Corp. (GM) and Ford Motor Co. (F) Wednesday posted weaker U.S. vehicle sales for October due to fewer blow-out incentives as inventories of older model 2004 vehicles declined.
Japanese rivals Toyota Motor Corp. (search) , Nissan Motor Co. Ltd. (search) and Honda Motor Co. Ltd. (search) all reported their strongest October results ever, with double-digit sales gains on the launch of several new models.
The Chrysler side of DaimlerChrysler AG (DCX) reported its sixth straight month of stronger results with a 2 percent gain, driven in part by the success of its new Chrysler 300 sedan.
Industry sales rose 2.2 percent to 1.33 million vehicles, for a seasonally adjusted annual rate of 17.0 million vehicles, up from the 16.1 million rate in October last year but down from the September's surprisingly strong 17.5 million.
Both GM and Ford offered interest-free loans for terms of up to six years during the last week of September to boost sales then, but ended up dampening demand the first part of October after the deals ended.
"Maybe (for Ford and GM) there was a little bit of pull ahead...from the sales last month," said Jim Sourges, a vice president with the automotive practice at consultants Capgemini. "Toyota and Nissan, they continue to hum."
Sales for GM, the world's largest automaker, fell 5.0 percent in October to 338,826 vehicles while Ford, the No. 2 U.S. car company, reported its fifth straight month of weaker results with a 5.3 percent drop to 249,484 vehicles. Chrysler sales rose 2 percent to 170,169 cars and trucks.
"Our sales were a little softer (in October) than we anticipated," Paul Ballew, GM's chief of sales and industry analysis, told analysts and reporters.
GM's U.S. market share dropped to 25.4 percent for its U.S. brands, down from 27.5 percent year-to-date. For the second straight month, GM also trimmed by 10,000 vehicles its expected quarterly production in North America.
Last month, GM and Ford said they lost money in the third quarter from their automotive units, due in part to the rising U.S. incentives.
Although Ford sales fell, company officials said new models such as the Ford Freestyle wagon and the Five Hundred sedan propelled its U.S. market share to 20 percent, its highest levels in a year.
Auto sales rose from last year despite the recent spike in oil prices and sagging consumer confidence. Ford Economist Jarlath Costello said that consumer spending was "remarkably resilient."
The end of the presidential campaign could also boost consumer confidence in coming months, said Gary Dilts, senior vice president of sales for Chrysler. "I think having that behind us and getting some clarity out there in the market place is going to bode well for the industry," Dilts said.
The average price of a gallon of gas on Wednesday topped $2 across the United States, just short of the record high of $2.054 for regular grade hit in May, according to the AAA motorist's group daily price survey.
Sales for other car companies were mixed. DaimlerChrysler's Mercedes brand reported a 5 percent drop in sales, while Volkswagen AG posted an 8 percent drop in U.S. sales, as did its luxury Audi brand. The German companies have been hurt by the stronger euro against the dollar.
Sales for Japan's Nissan climbed 27.3 percent, boosted by the addition of its new Titan pickup truck and new SUVs. Mitsubishi Motors Corp. (search) reported another steep drop in U.S. sales, down 44 percent in October, as the automaker has backed away from pushing profit-eroding sales with zero percent interest loans.