US Automakers Feel Pinch of Rising Gas Prices

Strategic Insights -

Automakers in the US saw mixed results in May as soaring gas prices and interest rates impacted sales. Toyota and Honda reported double-digit sales increases, while General Motors saw a 12 percent decline. The industry as a whole saw flat sales compared to May 2005, with trucks and SUVs down 7 percent and cars up 6 percent.

Key Takeaways:

  • Toyota's overall sales increased by 17 percent, with car sales up nearly 25 percent, driven by strong sales of the Yaris subcompact and the redesigned Camry.
  • Honda's car sales rose 21 percent, thanks to the success of the Fit subcompact and the redesigned Civic.
  • General Motors' car sales fell nearly 16 percent, partly due to a strategy to reduce sales to rental car companies.
  • Chrysler's truck and SUV sales dropped 14 percent, but sales of the 2007 Dodge Caliber, the replacement for the Neon, were strong.
  • Ford's SUV sales were down 21 percent, and even sales of the best-selling F-series trucks were flat.
  • Ford's car sales were up nearly 8 percent from last May, and the company saw a 55 percent increase in hybrid sales so far in 2013.
  • Ford aims to boost US sales with an aggressive incentive plan that includes zero-percent financing and a prepaid debit card for gas purchases.

Statistics:

  • The seasonally adjusted sales rate for May was 16.1 million vehicles.
  • Automakers sold 17 million vehicles in 2005.
  • Toyota's Yaris subcompact and redesigned Camry accounted for significant sales gains.
  • Honda's Fit subcompact and redesigned Civic contributed to the company's 21 percent increase in car sales.
  • General Motors' car sales declined by nearly 16 percent, with truck and SUV sales down 10 percent.
  • Chrysler's car sales slid 1 percent, but the 2007 Dodge Caliber saw strong sales.
  • Ford's truck and SUV sales fell 7 percent, with SUV sales down 21 percent.
  • Ford's hybrid sales rose 55 percent so far in 2013.

Sources:

  • The Associated Press, "Toyota and Honda see double-digit sales gains in May"
  • Autodata Corp., "Industry-wide sales data for May 2005 and 2006"
  • General Motors, "May sales report" (Paul Ballew, executive director of market and industry analysis)
  • Chrysler, "May sales report" (DaimlerChrysler AG)
  • Ford Motor Co., "May sales report" (George Pipas, US sales analysis manager)
  • Toyota Motor Corp., "May sales report" (Jim Lentz, group vice president for US sales division)