Originally created 02/02/05

GM, Ford report soft January sales



DETROIT - The nation's two biggest automakers, General Motors Corp. and Ford Motor Co., reported soft sales in January while DaimlerChrysler AG's Chrysler Group and Japan's Toyota and Nissan reported healthy gains in their U.S. sales.

The industry leader GM said Tuesday its overall sales increased 1 percent last month, while Ford, the nation's second biggest automaker, reported a 5.1 percent sales decline from January 2004.

But Chrysler had its 10th consecutive month of year-over-year sales growth, with overall vehicle sales up 9.2 percent. January sales rose 15 percent for Nissan Motor Co. and 6.2 percent at its bigger Japanese rival, Toyota Motor Corp.

The automakers said harsh winter weather in much of the country hurt sales as did strong December sales.

GM's car sales rose 2.1 percent, while light-truck sales slipped 0.3 percent. It cut its first-quarter production forecast.

Paul Ballew, GM's executive director of global market and industry analysis, cautioned against reading too much into January's outcome, though he acknowledged GM's start to the year was "a little softer than we expected."

GM lowered its first-quarter production forecast to 1.2 million vehicles, down 25,000 units from last month's guidance and 8.9 percent fewer than it produced in the first quarter of 2004.

Ford had announced late last month that it was trimming another 10,000 units from its North American production forecast. The company will produce 920,000 vehicles, 8 percent fewer than it turned out in the first quarter of 2004.

While reporting lower overall sales for January, Ford reversed its recent trend of stronger performance in trucks than cars, selling 5.1 percent more cars last month than a year ago but 9.8 percent fewer trucks.

Ford sales analyst George Pipas called both Ford's and the industry's January performance "weak," but not completely unexpected, given December's torrid industrywide sales pace - one of the highest on record.

"The industry has followed a predictable pattern over the last several years," Pipas said in a conference call with analysts. "Whenever we have a strong month, we have a weak month (to follow). Of course, we refer to that phenomenon as 'payback.'"

But Pipas also noted that January traditionally is one of the slowest months of the year for car sales and carries the least weight in predicting the full-year result.

Despite the relatively somber picture, Ford celebrated strong results for its new car models. It said combined sales of the Ford Five Hundred, the Ford Freestyle and the Mercury Montego increased about 5 percent from December to January.

Meanwhile, the hot-selling Mustang continued to move out of dealerships at a fast pace. Its sales were about 33 percent higher than a year ago, the company said. The Ford Five Hundred and the new Mustang came out late in 2004.

Chrysler car sales, continuing to feed off the popularity of the distinctive Chrysler 300, soared 47.3 percent. Truck sales nudged up just 0.2 percent.

"Our nine new products created tremendous momentum during 2004," said Gary Dilts, Chrysler's vice president for sales. "With the launch of additional products in 2005, we will continue to have the youngest product lineup in the industry."

The 15 percent overall increase at Nissan included a 4.1 percent decline in car sales and a 43.3 percent jump in truck sales. Nissan continues to benefit from sales of its first full-size pickup truck, the Titan, and a beefed-up lineup of sport-utility vehicles.

Still, business was hampered somewhat by harsh winter weather at times in the Midwest, Northeast and Southeast, said Jed Connelly, senior vice president for sales and marketing at Nissan North America.

Toyota said its car sales rose 14.9 percent, while trucks fell 2.7 percent.

"Considering the weather and the 'hangover' from December's spike in sales, January was pretty strong," Jim Press, chief operating officer of Toyota Motor Sales USA Inc., said. "It was encouraging to see consumer confidence edge up in January and evidence the economy will continue to expand throughout the next several months."

Meanwhile, a third Japanese automaker, Honda Motor Co., said vehicle sales declined 2.1 percent, including a 7.5 drop in car sales and a 6 percent increase in truck sales.

GM shares rose 8 cents to $36.89 in late trading on the New York Stock Exchange, while Ford's shares fell 8 cents to $13.09 and DaimlerChrysler's U.S. shares rose 65 cents to $46.16.

AP Auto Writer John Porretto contributed to this report.

On the Net:

General Motors Corp.: http://www.gm.com/

Ford Motor Co.: http://www.ford.com/

Toyota Motor Corp.: http://www.toyota.com

Nissan Motor Co.: http://www.nissanusa.com

Honda Motor Co.: http://www.honda.com