GM, Ford, Toyota Lag Estimates as Auto Rebound Fluctuates

General Motors Co., Ford Motor Co. and Toyota Motor Corp.’s April U.S. sales increases missed analysts estimates amid the “ebb and flow” of the economic recovery.

Only Chrysler Group LLC among the six largest automakers exceeded projections, as the company posted a 25 percent monthly gain that was its biggest since July 2005. GM today reported a 6.4 percent increase from a year earlier, Ford sales rose 25 percent and Toyota’s were up 24 percent.

Those results come as U.S. unemployment is holding at 9.7 percent, where it has been since January. The auto industry continues to recover, with the annualized sales rate achieving a sixth straight increase from a year earlier to 11.2 million light vehicles, from 9.2 million in April 2009, according to researcher Autodata Corp.

“We’re seeing the ebb and flow of the market recovery,” said Joseph Phillippi, president of AutoTrends Consulting Inc. in Short Hills, New Jersey. “We’re still working our way off the bottom. A rising tide lifts all boats, but some are lighter than others.”

The April sales rate was lower than the 11.4 million average of 8 analyst estimates compiled by Bloomberg. That outlook was based on sales in the month’s first 20 days, said Al Castignetti, vice president of sales at Nissan’s U.S. unit.

“The final 10 days of the month were a bit slower than we experienced earlier on,” he said.

Industry deliveries rose 20 percent to 982,131 from 819,685 a year earlier, said Autodata, which is based in Woodcliff Lake, New Jersey. The advance on that basis was the sixth in a row.

Chrysler’s Gain

Chrysler sales climbed to 95,703 from 76,682 a year earlier, according to a statement from the automaker. The average of 6 analyst estimates was for a 15 percent increase. The Auburn Hills, Michigan-based company filed for bankruptcy at the end of April 2009 and emerged with government aid in June under the control of Fiat SpA.

Chrysler in April “spent the most on incentives among any major automaker and relies the most on fleet sales,” said Jesse Toprak, an analyst at TrueCar.com. The Santa Monica, California- based data provider estimated that Chrysler last month averaged $3,537 a vehicle, compared with $2,798 for the industry.

“We’re really not expecting a whole lot from Chrysler until the Fiats start rolling in 2011,” Toprak said.

GM, Ford

GM sales rose to 183,997, from 173,007 a year earlier, according to a statement from the largest U.S. automaker. The percentage increase lagged behind the 7.2 percent average of 6 analyst estimates.

The Detroit-based company is trimming half of its eight U.S. vehicle brands under a plan to return to profit after emerging from its government-backed bankruptcy. GM said sales for the four brands it’s keeping rose 20 percent to 183,091, including gains of 36 percent each for Buick and Cadillac.

Ford, second biggest in the U.S., reported an increase to 167,543 vehicles sold, from 134,401. The gain was less than the 28 percent average of 6 analyst estimates. Sales excluding the Volvo brand that it’s selling also rose 25 percent, the Dearborn, Michigan-based automaker said in a statement.

Toyota, the largest Japanese automaker, reported 157,439 U.S. sales in April, rising from 126,540. The Toyota City, Japan-based automaker was expected to post a 34 percent increase, the average of 5 analyst estimates.

‘Waning’ Incentives

The company began offering increased incentives on March 2 after worldwide recalls of more than 8 million vehicles to fix defects linked to unintended acceleration and to adjust brakes. Toyota probably spent a per-vehicle average of $2,416 on incentives in April, according to TrueCar.com.

“Incentives are just not doing the job that they were before,” said Michelle Krebs, an analyst at research firm Edmunds.com in Santa Monica, California. “By the end of the month, their effectiveness was waning. If the industry is going to rely on incentives, they’ve got to find new tricks for May.”

Toyota will continue loan and lease offers this month, Bob Carter, U.S. general manager for the brand, said on a conference call today.

Honda Motor Co., the second-largest Japanese automaker, sold 113,697 cars and light trucks, rising from 101,029, Chris Martin, a spokesman for the Tokyo-based company, said in a telephone interview. The 13 percent gain trailed the 15 percent average of 4 analyst estimates compiled by Bloomberg.

Nissan, Hyundai

Nissan, Japan’s No. 3 automaker, said in a statement that its sales climbed 35 percent to 63,769 from 47,190. The average of 4 analyst estimates for the Yokohama, Japan-based automaker was for a 57 percent surge.

Hyundai Motor Co., South Korea’s largest automaker, said in a statement that it sold 44,023 vehicles, a 30 percent increase from 33,952 a year earlier. That was less that the estimate of a 35 percent gain from Edmunds.com.

Ford rose 28 cents, or 2.2 percent, to $13.30 at 4:15 p.m. in New York Stock Exchange composite trading, and the shares have gained 33 percent this year. Toyota’s American depositary receipts advanced 60 cents to $77.69, and have fallen 7.7 percent since the end of 2009.

The industrywide sales rate for April was down from 11.8 million in March, when Toyota started offering its biggest incentives to counter global recalls, spurring competitors to offer their own discounts.

Manufacturers, dealers and investors use the annualized rate to compare monthly totals by taking into account seasonal buying patterns.

Industry sales increases still underscore the market’s contraction in the recession. Annual U.S. deliveries averaged 16.8 million last decade through 2007. The 2008 total was 13.2 million, and 2009’s tally of 10.4 million was the fewest in 27 years, according to Autodata.

Consumers remain wary of big-ticket purchases, said Krebs, the Edmunds.com analyst.

“People are remembering and reining in their spending, she said. “We see the recovery as being very fragile. It’s going to be bumping along like this for a while.”

To contact the reporter on this story: Katie Merx in Southfield, Michigan, at kmerx@bloomberg.net

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