Auto sales bounce back
Most major automakers reported a sharp rebound in October after a terrible September, but auto sales are still flat compared to last year.
NEW YORK (CNNMoney.com) -- Major automakers reported Tuesday that their October sales rebounded following a weak September, as an increase in the number of cars available at dealers helped to get sales moving once again.
General Motors, Ford Motor and Nissan also reported that their sales were up from a year ago while Toyota Motor and Honda Motor said its sales were essentially unchanged from the same period last year. Chrysler Group reported sales fell 30% from October 2008, however.
Overall industry sales were on track to come in flat when compared to a year ago and up about 12% from September. Jessica Caldwell, senior analyst at auto industry tracker Edmunds.com said that's good news for the battered industry.
"We are trending in the right direction," she said. "Anything that shows any kind of improvement in this economy is a positive."
Caldwell added that it should be easier for auto companies to report year-over-year growth from this point on as sales at the end of 2008 and early 2009 were among the worst in decades.
"If we can't top November 2008, we're in trouble," she said.
Auto sales shot up for most major car manufacturers in late July and the first three weeks of August thanks to the government's Cash for Clunkers program, which offered up $4,500 of federal money to buyers trading in gas guzzlers when buying new cars. But the popular program left most auto dealers with limited supplies of vehicles in September.
Ford and other manufacturers increased their production in October to help replenish supplies on dealer lots. "We're definitely restocking and need to do more before the end of the year," said George Pipas, Ford's head of sales analysis.
Ford's inventories rose by 22% during October to about 375,000 vehicles, despite the stronger sales. Pipas said he expects inventories to continue to creep up to about 400,000 by the end of the year, but that inventories are now near planned levels for just about all models.
"Inventory is not an excuse for sales being up or down for any particular product," he said.
Ford said it believed its market share will come in above the 15.3% share it captured a year ago -- although that would be down from earlier this summer when GM and Chrysler were going through the bankruptcy process. The company added that retail sales, which excludes fleet sales to businesses such as rental car companies, rose for the 12th time in the last 13 months.
General Motors said that its light vehicle sales were up 5% compared to last October. That was its first year-over-year gain in sales in 21 months, but it was slightly below Edmunds.com's forecast of a 6% rise.
The No. 1 U.S. automaker was hurt by a 40% drop in sales at the brands it is in the process of closing or selling - Saturn, Pontiac, Hummer and Saab. Still, GM's sales were up 13% from September.
Ford Motor (F, Fortune 500) said its U.S. sales were up 3% compared to October 2008 and that sales jumped 21% from September. Edmunds.com had forecast that Ford's sales would be down 3% in October from a year ago.
Toyota Motor (TM) and Honda Motor (HMC) both reported that sales were flat compared to last year. For Toyota that was better than Edmunds.com's estimate of a 6% drop in year-over-year sales and also represented a 21% jump from September. Honda's sales rose 11% from September.
Despite Chrysler's big drop in sales from a year ago, it sales did rise 6% from September. Nissan (NSANY) said its sales were up 6% from last September and 9% from the previous month.
And Hyundai Motor Group, which owns both the Hyundai and Kia brands, continued to report growth that far outpaced the rest of the industry.
The South Korean automaker has posted significant gains in market share this year and sales for the two brands soared 47% from a year ago, easily topping the 38% rise forecast by Edmunds.com.