TodayMay 17, 2022

2005 Automobile October sales

The 2005 big picture

The numbers are bad for the auto industry. The decrease in sales from October 2004 to October 2005 is 14.1 percent. Depending on which industry analyst you talk to, the numbers differ. The reason is their reasoning. Some analysts don’t include Mercedes with Daimler Chrysler, or PAG with Ford. I am using J.D. Powers Power Information Network numbers because they include all the groups that are 100 percent owned by the parent company.

Behind the 1,144,176 million cars sold in October 2005 is the big picture. Truck sales are down 23.7 percent in October. Pickup trucks include anything from Hummer on down. It does not contain the International CXT that is 25,999 pounds or any Class 4 trucks and above.

General Motors was down 25.9 percent. Their truck sales were down 36.2 percent. Hummer (122.2%) and Saturn (7.1%) were the only brands that had increases in sales. The Saturn increase was from the truck side of the segment.

Ford Corporation was down 25.6 percent. Their pickup up truck sales was down 31.7 percent. Land Rover (40.2%) was the only brand that had an increase in sales.

The end of employee-pricing discounts may have hurt Ford and GM in October, two of the brands that kept the two U.S. companies in the black are models that have the lowest mpg of any vehicles.

Daimler Chrysler was only down 2.8 percent. Their truck sales were down 14.9 percent of Dodge (-11.3%) was the only brand that lost sales. Dodge’s loss would have been -10.5% and DaimlerChrysler’s loss would have been down only 1.2 percent since the Intrepid, and Ram Van (vehicles no longer sold) had not been included. Daimler Chrysler was the only Big 3 member that gained marketshare, from 14.16 percent to 16.01 percent year-to-date.

Honda broke even in October in total numbers, but both the Acura MDX (-17.2%) and the Honda Pilot (-16.1%) were down in sales. The big gainer was the Honda Insight (236%) going from 11 sales last October to 37 this October. The newly redesigned Civic and Civic hybrid also helped spur marketshare for Honda. The Honda Group marketshare has risen from 8.3 percent last October to 9.69 this October.

Mitsubishi sales were up 1.4 percent October over October, and their marketshare was up from .69 to .81 percent. All of their vehicles were above average on the last Consumer Reports rating. Mitsubishis Automotive Lease Guide (ALG) numbers, numbers that represent a residual value for a car, have gone up as well. Many people factor in resale value when purchasing a car.

CEO, Richard Gilligan explained one of the ways they were able to bring the ALG numbers up was by taking the fleet numbers down. “In 2003 Mitsubishi’s fleet sales were thirty percent of our total sales.” Gilligan noted, “we sold our fleet cars to the open auction because there were so many dealers that did not want to buy them all.” Gilligan went on to explain that if one’s resale vehicle price is lower than what they owe than they will be upside down for their next loan. “No one wants to stay with a brand where you owe more than it’s worth”.

Gilligan says for 2005 Mitsubishis sales should be 150,000 with only eighteen percent of their sales as a fleet. Toyota was up 1.3 percent in October 2005. Their marketshare was up from 12.83% to 15.13%. The only hybrid, the Toyota Prius, that has been out since last October saw an increase of 62.3%. Toyotas truck sales were down -6.6 percent and Lexus truck sales were down -12.4%. They were offset by the new Scion tC, Lexus GS and IS, and the Toyota Avalon.

While GM has suffered a global loss of $3.8 Billion dollars so far this year, Toyota just saw a net income profit in six months of 570,500,000,000.00 JPY which equals 4,823,221,044.94 USD. Commenting on the results in a press release, TMC Executive Vice President Mitsuo Kinoshita said, “We attained a high level of profit while expanding production capacity and developing advanced technology and future products in response to strong demand worldwide.”

Volkswagen was down 21 percent in October from the same month last year. The Phaeton (79%) and the Touareg (49%) were both down as the people’s cars and below average in reliability according to Consumer Reports.

According to Suzuki, American Suzuki Motor Corporation (ASMC) announced a 10 percent increase in sales through the first ten months of the year. ASMC is impressive year-to-date compared to the top-selling Forenza family, which sold 3,306 units in October. “48 percent increase over October 2004 “ and stands 73 percent ahead of last year’s sales total.

Also, October sales of the all-new media-lauded Grand Vitara, now available nationwide for the first full month, jumped an outstanding 145 percent over last October’s numbers.

According to NADA Chief Economist Paul Taylor, regular gasoline prices have fallen back to below $2.25 in many areas of the country as November begins – a positive trend. However, previously higher fuel prices caused truck sales to skid in October before that price declined. NADA expects prices of gasoline to stay under $2.40 over the next two months, and that should help sales of trucks and larger cars in the last two months of the year.

The Big 3 have already started to hike customer incentives compared with those offered in October. Big 3 inventories at 77 days supply, have rebuilt to a level that will support stronger incentives and sales. In another important development, the Fed raised rates again, by 1/4 percentage point, in an economy that grew at a robust 3.8 percent in real terms last quarter. Higher interest rates are not positive news, but it is good that they result from strong economic growth, despite the interruptions to commerce and to many people resulting from the hurricanes.

The continued increase in short-term rates will nip some car sales financed by “cash-out” refinancing of home mortgages as longer-term interest rates continue to increase. Chairman Greenspan will likely finish his tenure with at least two more 1/4 point rate hikes. All of this suggests that light-vehicle sales will be reasonably robust in the last two months of this year but on a glide path of moderation from the red hot July sales pace.

2005 October North American auto sales
2005 October North American auto sales
Lou Ann Hammond

Lou Ann Hammond is the CEO of Carlist and Driving the Nation. She is the co-host of Real Wheels Washington Post carchat every Friday morning and is the Automotive, energy correspondent for The John Batchelor Show and a Contributor to Automotive Electronics magazine headquartered in Korea. Hammond is a founding member of the Women's World Car of the Year #WWCOTY, and board member of the Women in Automotive.

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