GM sales surged 10% in December Camry is best seller, followed by Accord

Taurus falls to third

Auto Industry

January 08, 1998|By BLOOMBERG NEWS

DETROIT -- General Motors Corp. reported yesterday better-than-expected U.S. sales gain in December, but Japanese automakers also finished strong and gained market share in a year that saw little improvement in industry sales.

Toyota Motor Corp.'s Camry was the best-selling car in the country.

The Camry had been locked in a battle with Honda Motor Co.'s Accord for the bragging rights.

For the year, sales of the Camry rose 11 percent to 397,156, beating out the Accord, which had sales of 384,609.

Ford Motor Co.'s Taurus, last year's best-selling car, slipped to third with sales of 357,162, reflecting in part Ford's decision to reduce low-profit fleet sales.

For the industry, rich incentives and continued strong sales of sport utility vehicles and other light trucks boosted sales to an annualized rate of more than 15.7 million vehicles in December, making it the year's best month.

Full-year sales rose just 0.5 percent to 15.16 million cars and light trucks, however, as an abundance of high-quality used vehicles helped entice consumers away from new models.

"We've had four years of 15 million-plus sales, but sales should be much higher," said Jim Gillette, an auto industry consultant with IRN Inc. in Grand Rapids, Mich.

"Fifteen million has become something of a cap," he said.

GM, benefiting in part from weak sales in the year-ago month, said its U.S. car and truck sales rose 10 percent in December, topping analysts' estimates of a gain of about 8 percent. For the year, though, GM's sales fell 0.3 percent and the company failed to carry out its pledge to boost its market share above last year's 31.4 percent.

"It was going to be a no-excuses year, so I don't want to make any excuses for it," said GM Chairman and Chief Executive Officer John Smith Jr., who said he was disappointed with the company's market share.

Ford on Tuesday reported a bigger-than-expected 3.4 percent drop in December sales, while Chrysler Corp.'s sales for the month rose 2 percent, less than analysts had expected. Ford's sales fell 0.4 percent for the year while Chrysler's fell 6 percent, the worst performance among U.S. automakers.

Automakers say they can live with steady sales of about 15 million vehicles a year, because cost cuts and strong demand for high-profit light trucks such as the Ford Expedition have enabled them to boost profits.

Boom-and-bust periods of 16 million in sales followed by sales of 12 million a year wreak much more havoc, said Robert Rewey, Ford's group vice president for sales. Such cycles "make it very hard on the dealer and manufacturers," he said.

Pub Date: 1/08/98

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