306_hybrid_sales March 2006 Sales Automobiles and Energy Manufacturers Podcasts

Toyota is expected to sell it’s 300,000th hybrid in the US (including Hawaii) some time this week.

Through February Month End, there have been 288,790 Toyota/Lexus hybrids sold in the USA. As of this morning (with sales through Friday, March 24th) the total is 296,164. Toyota is currently tracking to sell over 13,000 hybrids this month and should hit the 300K number by Friday.

The good news doesnt stop for Toyota. The combined U.S. sales of Toyota, Scion and Lexus vehicles, according to the Power Information Network (PIN), totaled 217,284 unit’s in March. Toyotas March sales were an all time record for one month, up 6.9 percent from the same month a year ago. From March 2006 (544,841) to March 2005 (507,236) sales were up 7.4 percent. Toyotas marketshare as of March, 2006 is 13.8 percent.

Total Sales for March were 1,526,474, down from sales of 1,526,474 in 2005.

General Motors sales fell 14.4 percent from last year. From March 2006 (950,244) to March 2005 (1,002,502) sales fell 5.2 percent. General Motors marketshare as of March, 2006 is 24.21 percent, down from last year at 25.81 percent.

General Motors announced an agreement with the Cerberus Capital Management LP (CCM) to purchase 51 percent of General Motors Acceptance Corporation. According to Joanne Krell, Spokewoman for GMAC, “there are pre-closing conditions and regulatory approvals that have to be met before the sell is finalized. The pre-closing conditions include the buyers conditions that GMs credit rating not go below CCC and GMACs credit rating not go below BB. Currently, Moodys has GMAC at BA1 with a review, Fitch has GMAC rated at BB with a positive view and S&P with a rating of BB with developing implications. GM is rated BBB. There is also a regulatory approval with the Pension Benefit Guaranty Corporation (PBGC) on a liability agreement that says that GMAC will have no liability from General Motors pension benefit’s plan. If GM does not meet any of these conditions, CCM has the right to option-out of the deal.”

Krell went on to explain that GMAC sold 78 percent of their commercial mortgage unit on March 23,2006. The sale netted proceeds of $8.8 billion of which $7.3 billion goes to paying off intra-company loans. GMAC has three distinct business operations; finance, isurance and mortgage. The finance segment netted $660 million in 2005. The Insurance segment netted $417 million. The Mortgage segment, known as ResCap, netted $1.311 billion. In 2005, GMAC earned more than $2.8 billion, but took a charge in the fourth quarter, resulting in a net of $2.394 billion for the year. GMAC paid a return dividend to GM of $2.5 billion and had $20 billion in cash. GM is expected to receive $14 billion from the 51 percent sale of GMAC; $7.4 billion in cash, $2.7 billion in a conversion of GMAC to a limited liability company and the rest is cash flow of assets monetized over 3 years.

According to Wikipedia, “Cerberus Capital Management LP is a large, politically-connected, privately-owned hedge fund. The firm is based in New York, NY and run by 45 year old financier Steve Feinberg. Former Vice President Dan Quayle has been a prominent Cerberus spokesperson and runs one of it’s international unit’s.

Founded in 1992, Cerberus invests primarily in companies which are near bankruptcy, and hopes to make the businesses it acquires profitable.”

In a Standard and Poors statement on their website, they say “GM is in a deal to sell a 51% controlling interest in General Motors Acceptance Corp. (GMAC) to a consortium of investors led by Cerberus Capital Management. It expects to receive about $14 billion in cash from the deal over three years. The agreement appears to have better financial consideration than we expected, as well as several terms that allay some of our concerns about GM retaining only a minority interest. The sale is expected to close in the fourth quarter, subject to normal approvals. We do not expect the transaction to be significantly dilutive to 2006 earnings per share (EPS,) but we expect more dilution in 2007. Some of the success of the transaction will be conditioned upon GMACs ability to improve it’s credit rating and lower it’s and GMs borrowing costs.”

Krell says that GMAC is excited by the sell, “There is a lot of energy for this transaction. GMAC had ten years of growth. This is the first year that was not on record. This sell should strengthen our credit rating and lower the cost of capital.” Ford sales fell 4.8 percent from last year. From March 2006 ( 728,584) to March 2005 (750,110) sales fell 2.9 percent. Fords marketshare as of March, 2006 is 18.56 percent, down from last year at 19.31 percent.

A survey released by Edmunds.com said the average incentive on a vehicle sold in March, 2006 was $2,510, up 7 percent from February, 2006. GM, Ford and Chryslers combined incentive, according to Edmunds, averaged out to $3,205 per vehicle in March, 2006, compared to $3,001 from February, 2006.

According to J.D. Power and Associates and the Power Information Network (PIN)

  • The retail side of the market improved for the second consecutive month in March, after a weak start to the year, but still remains below trend as fleet volumes continue to bolster the market as a whole. Fleets accounted for 22% of all sales.
  • Total light-vehicle sales, including fleet, were unchanged from a month ago at a 16.5 million-unit selling rate, compared to 16.8 million unit’s the previous year. Retail sales accounted for 12.9 million unit’s, compared to 13.1 million unit’s a year ago.
  • Sales of both cars and trucks were unchanged from year-ago levels, which means that trucks on a seasonally adjusted basis have outsold cars for two of the first three months of 2006.
  • Two light-truck segments “ compact pickups and full-size SUVs “ took a beating in March, with sales down 19% and 13%, respectively.
  • The economic stoplight indicators continue to be predominately “green,” with economic growth in the first quarter expected to reach 5% annualized growth from less than 2% in the previous quarter, despite growing signs of a housing slowdown.According to Tom Libby, Senior Analyst, Power Information Network, “Consumers purchased 1,572,909 new cars and light trucks in March, down approximately 46,000 unit’s, or 3%, from March 2005. Although both car and light-truck sales declined, cars slid less than trucks, making March the third consecutive month in which cars have outperformed trucks on a percentage-change basis.”

    The top 20 selling models for March 2006 were;

  • Ford F-Series
  • Chevy Silverado
  • Toyota Camry/Camry Solara
  • Dodge Ram Pickup
  • Honda Civic
  • Honda Accord
  • Toyota Corolla
  • Chevy Impala
  • Nissan Altima
  • Dodge Caravan
  • Chevy Cobalt
  • Ford Taurus
  • Chevy Malibu
  • Ford Explorer
  • Chevy Sierra Pickup
  • Chevy Tahoe
  • Chevy TrailBlazer
  • Hyundai Sonata
  • Ford Escape
  • Ford Focus
  • 3_06_ytd March 2006 Sales Automobiles and Energy Manufacturers Podcasts
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