Lineup

Car Sales Cool in January, Hit by Weather

Car Sales Cool in January, Hit by Weather
Wed February 4, 2004 12:23 AM ET
(Page 1 of 2)
By Michael Ellis

DETROIT (Reuters) - General Motors Corp. and Ford Motor Co. on Tuesday posted surprisingly weak U.S. vehicle sales in January, hurt by an aging lineup, while Japanese competitors Toyota and Nissan both scored impressive gains.

Sales were hurt by the cold weather which kept consumers away from dealerships in many parts of the country. Industry sales fell 0.7 percent to 1.13 million cars and trucks in January, for an annual rate of 16.1 million vehicles, unchanged from January last year.

Wall Street analysts had expected that the strengthening U.S. economy and high incentives would push U.S. vehicle sales up from last year, when the run-up to the Iraq war kept consumers on edge.

"When tomorrow's papers are published, the headlines will be difficult to swallow," George Pipas, Ford's director of sales analysis, told reporters on a conference call.

Ford has labeled 2004 the "Year of the Car," but pickup trucks, minivans and SUVs were its only big sellers in January, with results up 10.7 percent from last year. Car sales fell 12 percent in January to account for only about 44 percent of total sales.

"There's been no question that there's been some sales opportunities lost in the Northeast because of the weather. Nothing dramatic, but definitely an impact," said Jed Connelly, senior vice president of sales and marketing for Nissan North America.

The mantra inside GM is "Fast Start in '04," company officials said last month. But the automaker's passenger vehicle sales dropped 1.8 percent to 294,745 cars and trucks in January, excluding its Saab brand. Analysts had expected GM sales to be up as much as 5 percent.

Ford sales for its U.S. brands fell 9.7 percent in January to 212,449 cars and trucks. Sales percentage change figures are adjusted to account for 26 selling days in January vs. 25 last year.

Meanwhile, DaimlerChrysler AG's Chrysler division scored its fourth straight month of year-over-year gains, as its sales rose 9.4 percent in January. Chrysler, which will roll out nine new vehicles this year, said its sales were boosted by strong results for its new Dodge Durango SUV and its minivans, which will be replaced with new models later this month.

SALES INCENTIVES

Ford and GM shares both closed down about 1.7 percent on the New York Stock Exchange on Tuesday. Continued ...