Chrysler Group LLC led the five largest automakers by U.S. sales in exceeding analysts’ estimates for April as the industry’s increased production drove expansion in the manufacturing sector.
Chrysler sales climbed 20 percent to 141,165 light vehicles and Toyota Motor Corp. (7203)’s deliveries rose 12 percent to 178,044, according to company statements. Those results beat eight analysts’ average estimate for increases of 16 percent and 10 percent. General Motors Co. (GM), Ford (F) Motor Co. and Honda Motor Co. (7267) said sales declined by less than analysts’ estimated.
Stronger demand for automobiles bolstered U.S. manufacturing, which grew in April at the fastest pace in almost a year, according to Institute for Supply Management. The group’s factory index climbed to 54.8 last month, the best reading since June. Chrysler, Ford and Hyundai Motor Co. (005380) said this week they will add shifts at factories this year.
“We’ve got ourselves steady, sustainable growth in the market,” said Alan Baum, principal of auto-industry forecaster Baum & Associates in West Bloomfield, Michigan. “The auto industry is going through a little bit different cycle that is obviously helping the overall economy.”
Total light-vehicle sales in April gained 2.3 percent to 1.18 million, according to Woodcliff Lake, New Jersey-based researcher Autodata Corp. The industry’s seasonally adjusted annual rate, or SAAR (SAARTOTL), was 14.4 million. The pace topped the 14.3 million estimate that was the average of 15 analysts surveyed by Bloomberg.
Ford deliveries fell 5.1 percent to 179,658 cars and light trucks, and GM sales dropped 8.2 percent to 213,387. The automakers beat analysts’ estimates calling for a 5.7 percent decline for Ford and 9 percent decrease for GM.
Adjusted for “selling days,” which exclude Sundays and holidays, Ford’s sales rose 6.8 percent and GM’s gained 3.2 percent. Some analyst exclude non-selling days to compare year-over-year results because many dealerships are closed.
April 2012 had three fewer selling days than the year-earlier month. April 2012 was just the second month in the last 10 years that such a wide disparity occurred, Jim Cain, a GM spokesman, wrote in an e-mail.
Chrysler, which builds more than half of its vehicles in the U.S., boosted worldwide shipments by 25 percent in the first quarter, the automaker said last week. The company is accelerating the addition of 1,100 jobs and a third crew of workers at a Detroit plant by adding them in November, rather than waiting until early 2013, Chief Executive Officer Sergio Marchionne said yesterday.
Deliveries of Chrysler’s 300 sedan more than doubled in April to 7,763, the Auburn Hills, Michigan-based company said today in a statement. Marchionne is counting on the new Dodge Dart compact, which begins production this week, to sustain Chrysler’s momentum later this year after 11 straight months of sales gains topping 20 percent.
“We continue to underestimate the power of Sergio,” Rebecca Lindland, an analyst with IHS Automotive, said today in a telephone interview. “They have the product to keep going,” she said, citing the upcoming Dart and increased production of Jeep Grand Cherokee and Dodge Durango sport-utility vehicles.
Chrysler’s U.S. market share rose 2 percentage points to 11.6 percent through April, according to Autodata.
GM, the world’s top seller of cars and trucks, raised its forecast for full-year U.S light-vehicle sales to 14 million to 14.5 million, up from as much as 14 million. The company cited better-than-expected industry results in the first quarter and its expectation for sustained economic growth.
“Demand for automobiles is helping propel production,” Jack Ablin, chief investment officer of Harris Private Bank in Chicago, which oversees about $60 billion, wrote in an e-mail. “We expect this trend to continue even in the face of moderating economic winds abroad.”
GM, the top-selling automaker in the U.S., is introducing new models such as the Chevrolet Spark small car later this year to boost U.S. market share that fell by 1.9 percentage points in the first four months to 17.7 percent.
Ford, the No. 2 U.S. seller, said deliveries of its Fiesta subcompact plunged 44 percent to 5,135. The Dearborn, Michigan-based company sold 37 percent of its vehicles to fleet customers last month, Erich Merkle, the automaker’s sales analyst, said on a conference call.
Ford has said it can’t keep up with demand and sees its U.S. market share dropping this year as a result. Factory production will increase by 400,000 vehicles on an annualized basis for the remainder of the year, which should slow Ford’s share loss, Ken Czubay, the automaker’s U.S. sales chief, said today on the call.
“We’ll be caught up on share as the production comes on line,” Czubay said. Ford’s U.S. market share slid to 15.4 percent through April from 16.2 percent a year ago, Autodata said.
GM rose 1.3 percent to $23.31 at the close in New York while Ford slid 0.4 percent to $11.23. The benchmark Standard & Poor’s 500 index climbed 0.6 percent and erased an earlier decline after Tempe, Arizona-based ISM released its index.
Affiliates Hyundai and Kia Motors Corp. (000270), both based in Seoul, combined to sell 0.9 percent more vehicles than a year earlier, topping six analysts’ average estimate for a 0.4 percent drop. Hyundai will add a third shift at its main assembly plant in Montgomery, Alabama, to meet U.S. demand for its Sonata sedans and Elantra compacts, the company said yesterday in a statement.
Deliveries of the Kia Optima sedan surged 69 percent to 11,021, according to a statement. Sales of Hyundai’s Accent increased 40 percent to 6,160.
Honda Versus Nissan
Honda deliveries slid 2.2 percent for the second consecutive monthly drop. That was better than the average estimate of eight analysts for a 6.7 percent decline. The Tokyo-based carmaker regained its spot as the fifth-largest automaker by U.S. sales from Nissan after deliveries of the mid-size Accord rose 26 percent to 35,385, according to a statement.
Nissan Motor Co. (7201) deliveries slipped 0.3 percent, missing eight analysts’ average estimate for a 19 percent gain. Sales of the automaker’s top-selling Altima sedan, a redesigned version of which arrives at dealerships in July, slipped 5.8 percent to 16,239, the company said in a statement.
Toyota’s market share through April increased to 14.3 percent through April from 14.1 percent. Honda’s declined to 9.5 percent from 10.3 percent. Nissan’s was unchanged at 8.5 percent. Hyundai and Kia held a combined 8.9 percent of the U.S. market through April, up from 8.4 percent, according to Autodata.
Volkswagen AG (VOW), which is on pace to exceed its target for more than 500,000 U.S. sales this year, increased combined sales of its Volkswagen and Audi brand vehicles by 27 percent in April, exceeding four analysts’ average estimate for a 9.2 percent gain. The company’s market share rose through April to 3.7 percent from 3.1 percent a year earlier.
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