General Motors sees its March sales in the U.S. tumble 6.6% on a daily basis, although year-over-year volume grew modestly on brisk demand for products from its Chevrolet and GMC brands.
GM sold 252,128 cars and trucks last month compared with 249,875 in like-2015, according to WardsAuto data. There were two extra selling days vs. March 2015, a factor that pulled down GM’s year-over-year comparisons, but the automaker remained behind an industry expected to post a small uptick in overall light-vehicle sales.
The Detroit automaker says its March results reflect a strategy placing an emphasis on building profitable retail sales over lower-margin deliveries to fleet customers, especially rental-car companies. GM also has said it wants to keep incentives in check, despite the risk of sacrificing volume, to grow its average transaction prices and maintain stable inventory levels.
“We are growing retail sales faster than the industry, and we are doing it with disciplined incentives and inventories and lower rental deliveries,” says Kurt McNeil, vice president-U.S. Sales Operations at GM.
“Our business is very healthy, and we are going to manage it with conviction to keep it that way,” he says in a statement.
GM says it gained a full percentage point of retail market share last month, while sales to rental agencies dropped 43,000 units vs. year-ago. WardsAuto data shows GM’s overall market share, however, slipped to 15.3% from 16.2% last year.
The automaker says its ATPs were $35,800 in March, slightly below third-party estimates, up more than $1,500 from February and $5,000 ahead of the industry average. Incentives, GM says, were 10% of ATPs, below competitors and an industry average of 10.8%. On a per-unit basis, third-party estimator TrueCar pegs GM incentives at $4,022 last month, up 28.5% vs. last year and ahead of the industry average at $2,721.
It was a solid month for GM’s volume Chevrolet brand, where sales volumes rose to 176,283 from 173,886 against a daily sales dip of 6.1%. Standout performers included the redesigned Malibu sedan, up 23.4% to 22,058 from 16,552, and the Colorado midsize pickup, up 35.9% to 9,718 from 6,621. Sales of the Tahoe large SUV grew 3.4% to 7,658 from 6,860.
The GMC brand also saw brisk demand, with deliveries increasing to 44,585 trucks and CUVs from 41,707 although the year-over-year comparison was flat. Sales of the Yukon jumped 18.1% to 3,394 from 2,661, while the long-wheelbase model of the profitable large SUV expanded 13.7% to 2,427 from 1,977. Deliveries of the Canyon, a sister pickup to the Colorado, soared 9.1% to 2,867 from 2,434.
GM officials say the rise in Colorado and Canyon sales in March resulted from greater availability following capacity adjustments at its Wentzville, MO, assembly plant.
Buick sales last month dropped 17.9% to 18,207 from 20,526 on a daily basis, and Cadillac sales declined 12.1% to 13,053 from 13,756.
GM Chief Economist Mustafa Mohatarem expects industry sales, coming in at a projected 17.1 million units adjusted for annual rates, will remain strong through the remainder of the year on solid economic fundamentals.
“The underlying strength of the U.S. economy is very positive for auto sales,” Mohatarem says.
“We expect historically low interest rates, strong employment, rising wages and stable fuel prices to continue for the foreseeable future. The (Federal Reserve’s) decision to delay interest rate hikes should extend the current sales cycle, and allow the auto industry to continue to lead the overall U.S. economic recovery, as it has throughout the current cycle.”