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Big Three sales drop
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February 1, 2002: 3:43 p.m. ET
GM, Ford, Chrysler report declining January sales as incentives expire.
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NEW YORK (CNN/Money) - The Big Three automakers all reported a drop in U.S. vehicle sales in January as zero-interest incentives that kept sales strong in the fourth quarter expired, but General Motors Corp. and Ford Motor Co. said the results were better than expected and Ford raised its projection for industry sales for the year.
General Motors, the world's largest automaker, posted a 13 percent drop in January vehicle sales to 299,634. But GM said that decline was due to a drop of 40,000 vehicles in sales to the daily car rental companies. Without that decline in sales to rental car companies the company said it would have seen relatively flat year-over-year sales comparisons.
Shares of GM (GM: Research, Estimates) closed down 3 cents to $51.11 in Friday trading, while shares of Ford (F: Research, Estimates) dropped 40 cents to $14.90. The American depositary receipts of DaimlerChrysler AG (DCX: Research, Estimates) fell 56 cents to $40.
GM saw particular strength in the sale of light trucks, which includes sport/utility vehicles, pickups and vans, which saw a 10 percent overall gain to 183,001 vehicles, and a 15 percent gain in sales to retail customers. Overall car sales plunged 34 percent from a year ago, but much of that decline was due to the drop in sales to car rental companies along with steep declines at its Oldsmobile and Saturn brands.
GM announced more than a year ago it would discontinue Oldsmobile later this year and Saturn did not have the new $2,002 in incentives that other GM brands offered in January. Paul Ballew, executive director for market and industry analysis, said that excluding Saturn and Oldsmobile, that GM's retail U.S. car sales fell only about 5 percent.
Ford raises industry outlook
Ford, the world's No. 2 automaker, saw U.S. vehicle sales fall 10 percent from both year-ago and December levels. Car model sales fell 17.5 percent from a year ago to 79,687, while U.S. sales of light trucks fell 6.3 percent from a year ago to 153,295.
"January sales were better than we expected at the beginning of the month," said George Pipas, Ford's U.S. sales analysis manager, speaking of his company's sales. "We expected them to be down 15 to 20 percent."
Ford executives said that an improvement in a number of economic indicators, including consumer confidence, led it to project industry-wide U.S. car and light truck sales of about 15.7 million this year, up from its earlier forecast of 15.2 million. U.S. sales last year hit about 17.2 million light vehicles, the industry's second-best year in its history.
GM's Ballew said GM may also raise its U.S. industry forecast to a similar range, but that it wants to get another month or two worth of data before it does so. But he termed industry sales, which were on a 16-million-vehicle sales pace, better than expected.
"I think it's still prudent to remain cautious," Ballew said. "January has gotten us off to a pretty good start for the industry."
Chrysler SUV sales plunge
Chrysler, the North American unit of DaimlerChrysler AG, saw sales fall 9 percent, hit by a sharp 19 percent drop in sales of its SUVs. Chrysler's light truck sales were off 9 percent to 106,785, while car model sales slipped 8 percent to 39,614.
"While we would have liked to start off the year at a higher level, we are in an intensely competitive market and have developed a strategy for all three brands to regain their momentum quickly," said a statement from Gary Dilts, Chrysler's senior vice president of sales.
Chrysler recently announced an industry-leading $2,500 in incentives for select 2002 model year Chrysler, Jeep and Dodge.
Ford and Chrysler followed GM in letting zero-interest financing incentives expire last month and replacing them with cash-back offers on most new vehicles.
Imports continue to rise
While the traditional Big Three lost ground in January, most of the major Asian and European automakers posted gains in U.S. sales in the month.
Toyota Motor Corp. (TM: Research, Estimates) posted a 7.1 percent gain in U.S. sales to 126,508 vehicles between its Toyota and Lexus brands, putting it just 14 percent behind Chrysler Group sales. It continued to gain SUV share with an 18.4 percent gain in that segment, with most of the gain coming from its Highlander model.
Honda Motors Co. (HMC: Research, Estimates) saw U.S. sales slip 1.5 percent from its record January performance of a year ago, but Nissan Motors Co. (NSANY: Research, Estimates) and Mitsubishi Motors along with Korean automakers Hyundai and Kia both posted sales gains. American depositary shares of Toyota, Honda and Nissan all lost ground, though.
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German automakers Volkswagen, BMW and Audi all also posted gains in U.S. sales in the period, with Audi setting a January sales record. 
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