Industry Posts A Strong First Quarter
Automakers have been posting first-quarter earnings, and they suggest the market is gaining speed -- as participants and observers had predicted would happen. General Motors' largest division, Chevrolet, sold 1.18 million vehicles worldwide in the quarter -- which the company says represents a 6.5% increase over the period last year. Chevy also says this was the sixth consecutive quarter of record-breaking sales worldwide for the brand, bringing global share to 6.3%.
General Motors Chairman and CEO Dan Akerson said in a company statement that GM has more than 20 major vehicle launches happening around the world in 2012, with Chevy represented by the Chevy Sail in Asia, the Colorado in South America and the Spark micro in North America.
The Chevrolet Cruze compact led the brand with global sales of more than 180,000 in the first quarter, per GM -- a nearly 20% increase over 2011, making it the best-selling Chevrolet nameplate around the world. The automaker has said it plans to bring a diesel version of the Cruze to the U.S., which is emblematic of how far we have come from bad memories of domestic diesel. They are only about 3% of U.S. sales -- but that's up 35% in the first quarter of 2012 compared to the same period in 2011, per GM.
Across town, Chrysler Group's net income in the quarter increased by a factor of four to $473 million with operating profit up 55% to $740 million. The automaker reported that its global vehicle sales for the first quarter totaled 523,000 -- up 33% from a year ago. It also saw a big increase in U.S. market share to 11.2% from 9.2% in the year-ago quarter. The Auburn Hills, Mich.-based company attributed the increases to its 40% increase in U.S. retail sales. Also, Chrysler said that for the first time ever, it was the quarterly market leader in Canada, getting 15% share there in the first three months this year.
Ford's news is mixed because of weaker sales outside the U.S. The automaker posted first-quarter pre-tax operating profit of $2.3 billion, a decrease of $544 million from the first quarter last year. In the North America market, however, Ford's pre-tax profits were $2.1 billion, an increase of $289 million from first quarter of 2011. Ford said the North American results represent its highest quarterly profit since at least 2000.
Jesse Toprak, VP of market intelligence at TrueCar.com, said the automaker's earnings were also hurt by market share declines in the U.S. He also said Ford has a production problem, and it's not the one Detroit has been saddled with for years: oversupply. Ford actually has too few vehicles to meet demand."The old problem of over-production is now turning into an under-production issue -- neither of the scenarios are ideal for a carmaker," he said. But he points out that the automaker now has the best balanced portfolio in recent memory -- a fact that highlights the domestics' refocus on cars over the past few years. "Ford’s brand image has also improved dramatically in the last few years. Ford is on a solid footing with a positive long-term outlook, just as long as they are better able to align their production with the actual consumer demand."
Honda's first quarter saw net income increase 60.7% from the same period last year, with global automobile sales at 988,000 units, up 14.9% from last year.
In Stuttgart, Daimler AG is lauding its Mercedes-Benz unit for driving a 20% net profit increase. Said Dieter Zetsche, chairman of the board of management of Daimler AG and head of Mercedes-Benz Cars (and one-time head of Chrysler): "We are on schedule to meet our targets for this year as well as our medium-term targets."
In the first quarter of 2012, the Daimler Group sold 502,100 cars and commercial vehicles worldwide, surpassing the prior-year number by 9%. The corporation said Mercedes-Benz hit a record for unit sales in the first quarter, posting a 9% increase to 338,300 units globally, with Europe and the United States driving its volume performance. The company said the Mercedes-Benz C-Class segment -- its highest-volume car -- and SUVs drove sales.