US Big 3 automakers score solid sales in June

The Big Three US automakers reported strong domestic sales for June Tuesday, capping a solid first half of the year even as US economic growth overall remained weak. Despite economic headwinds, Chrysler and General Motors both posted double-digit increases in US sales last month, while Ford grew sales by seven percent. However, for the first half of the year, Asian carmakers overall were able to pick up ground in their American rivals' home market. Nissan, Honda, Toyota, Kia and Hyundai all posted double-digit increases during the six months to June 30, while GM only increased sales by 4.3 percent, and Ford by seven percent. "We're not disappointed at all in the first half of the year," said Kurt McNeil, GM's vice president for US sales operations. "We knew there were going to be economic headwinds... We're still expecting moderate and gradual growth." McNeil said that growing credit availability and signs of an uptick in housing are helping the market, offsetting slow job growth and a drop in consumer confidence. Based on the June pace, he said forecasts were now for full-year sales for the industry of more than 14 million units, up from May's forecast of 13.7 million units. "High auto sales volumes in June can be attributed to pent-up demand, some targeted incentive programs, low interest rates and falling gas prices," said Michelle Krebs of industry specialists Edmunds.com. "There was great pressure from automakers to close June strong, especially after the unexpectedly weak Memorial Day holiday weekend in May," added Edmunds's Jessica Caldwell. "It is the end of a quarter so undoubtedly they wanted to finish big. Two weak months in a quarter would make for unfavorable reporting." GM reported June US sales of 248,750 vehicles, up 16 percent from a year ago and the company's highest monthly sales since September 2008. Chrysler sales improved by 20 percent as the automaker posted its best June figures in five years, 144,811 units, and its second quarter was 24 percent higher than the same period in 2011. Ford, the only one of the Big Three to survive the 2008 economic crash without a government bailout, reported a more modest 7.0 percent year-on-year gain with 207,759 vehicles sold. Standard & Poor's analyst Efraim Levy said while Ford's growth lagged behind GM, Toyota and Chrysler, it is still in a strong position. "Ford's vehicle inventory level at about 57 days of sales is at a healthy level, in our view. We also see lower incentive spending compared to May as positive," Levy said, in a note to investors, Even as the Big Three saw good demand, the sales at their foreign rivals grew faster. Nissan North America reported a 28 percent sales increase and Honda reported a 48 percent rise in sales during June. Nissan sales were up 14.3 percent for the first six months of the year, while Honda's increased 16 percent. Toyota sales increased 60 percent in June and are up 29 percent for the year so far as the company regained market share lost after the March 11, 2011, earthquake-tsunami disaster reduced its stock of vehicles. Volkswagen of America reported a 34 percent sales increase and a 35 percent gain for the first half of the year. Kia was up 14 percent in June and 17.8 percent for January-June. Hyundai's US operation posted June sales of 63,813 units, up eight percent over a year earlier. "Despite a slight softening in May and June from the surprisingly strong industry retail sales pace for the first four months of the year, the Hyundai brand continues to build retail sales momentum and consistently achieve all-time monthly volume records," said Dave Zuchowski, executive vice president of sales.