A very good year for automakers

For the auto industry, this is certainly not a winter of discontent -- except maybe at General Motors.

Sales for the first month of 1997 are rolling along at a seasonally adjusted annual rate of 15.5 million with total January sales of 1,091,980 cars and light trucks, a 6.3 percent gain over January `96.

Granted, in January `96 blizzards left a lot of East Coast sales people lonely in the dealerships, which tends to make the sales increases this year seem less important, but you can read some significance into who's gaining and who's losing. The sagging Japanese yen and a strong U.S. dollar are helping boost Japanese gains in U.S. market share, now at 24.54 percent of the market vs. 21.18 percent a year ago. Toyota alone showed a whopping 55 percent rise in January `97 sales over the `96 January. But even in the face of the Japanese gains, both Ford and Chrysler posted sales increases; only GM among the domestic makers lost ground, slipping 0.9 percent off last year's pace. More disturbing, however, is the fact that GM's market share now stands at 30.1 percent, a post World War II low with no sign of a turnaround any time soon. Ford posted a 2.8 percent gain for a 25.4 percent market share and Chrysler boosted January sales 1.5 percent finishing the month with a 15.4 percent share. The question now being asked is: How long before Ford passes GM? Last year was the best sales period for the industry since 1988 with 15.1 million cars and light trucks sold, a 2.5 percent gain over 1995. Still, GM managed to slip from 32.8 percent of the U.S. market in 1995 to 31.3 as 1997 dawned. Ford slipped a bit overall, too, from 25.7 percent to 25.4 percent at the end of `96. Chrysler, capitalizing on a revamped and revived truck line, gained 1.5 percentage points. However, at the end of January, Ford was back to 25.4 percent of share and Chrysler to 15.4 percent. Trucks defined the market in `96 as more and more Americans turned from traditional automobiles to vans, pickups and sport/utilities. More domestic trucks were sold in `96 -- 5,710,265 -- than domestic cars -- 5,327,556; domestic car sales actually fell almost 200,000 as trucks gained more than 400,000. Imports gained in both car and truck sales. Just how popular are trucks? Of the top 10 selling vehicles, five are trucks; of the top five sellers, four are trucks. The top selling vehicle of `96 was the Ford F-series pickup followed by No. 2 selling Chevrolet C/K pickups. The rest of the field, in order, was Ford Taurus, Ford Explorer, Dodge Ram pickup, Honda Accord, Jeep Grand Cherokee, Toyota Camry, Chevrolet Cavalier, and Honda Civic. Some manufacturers are faring better than others. Mercedes-Benz, in sharp decline only a few years ago, has made a spectacular comeback with a revamped product line and sharp price cuts posting a January increase of 28.5 percent and expecting to crack the 100,000 sales mark in the United States for the first time in company history. And for the first time, Benz is poised to offer a mini sport/utility even as Honda launches its CR-V against the Toyota RAV- 4 and Suzuki's minis. For the sports car crowd, though, Benz has a new 2-seater, the SLK, a pretty little car with plenty of pep but no manual transmission. Cadillac is taking another fling at small, introducing the rear- drive Catera, an Opel in Cadillac livery but, unlike its predecessor Cimarron, a small car with some performance. And Ford has bypassed `97 altogether in a couple of car lines introducing a `98 Contour and a new sport version of Escort. For the consumer, the good news is technology; the cars are better equipped, safer, and longer-lived than ever. The bad news is price -- but there's a silver lining in that price cloud. The more players, the more competition for your business -- which means more wiggle room in the deal. And, of course, it's February, which means it must be spring, at least in the car business.

Copyright 1997
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