• by Karl Greenberg , October 5, 2006

Lower gasoline prices combined with generous incentive deals are helping some automakers move their truck inventory, but doing nothing for others.

While Toyota, Ford and GM saw some increases last month in sales of their trucks and SUVs, Chrysler Group and Nissan continued to see sales drop.

This week, Toyota reported its best-ever monthly sales for each of its Toyota, Lexus and Scion divisions, with an overall year-over-year September increase of 20.2 percent. It saw a whopping leap of 67.2 percent in Tundra pickup truck sales for the period. In February, the redesigned 2007 Tundra arrives in showrooms.

Overall Toyota truck sales, up more than 35 percent, benefited from rebates. According to consultancy J.D. Power & Associates Power Information Network, the automaker increased its cash rebate on Tundra by $700 from July to August--raising it to $1,200, while dropping the price of the vehicle from $27,000 to $25,000. Similar rebates were applied to Toyota's Highlander, 4Runner and Sequoia SUVs, Tacoma mid-sized pickup and Sienna minivan.

Tom Libby, automotive analyst for J.D. Power, says it's not surprising that a $1,200 discount could spur a 67 percent sales increase, because Toyota already has tight supply, and uses few incentives.

"They have an awful lot of wiggle room," he says, noting that the company's "days of turn" or days vehicles sit on dealer lots--a measure of demand--is only 25 days on average, compared to the industry average of 68 days.

Both Nissan and Chrysler Group are sitting on large truck inventories and neither saw much relief last month, for either truck or car sales. Nissan's Titan pickup truck is off almost 17 percent year to date, and 17 percent alone last month. Nissan sales overall dropped 9.2 percent last month and 7.5 percent for the year, the company reported.

Todd Turner, with Car Concepts, Los Angeles, says that Nissan's sales represent a gap in new product introduction. Their volume vehicles are Sentra (compact car), Altima, and Infiniti G35, and because each of these is in transition, sales will probably stay low all year, he says.

Ironically, given the struggle Ford and GM have had in regaining the car market, Ford's recent sales gains have come from new cars like Fusion and Lincoln Zephyr. "It's a good omen for Ford because if they are up in a month where they aren't introducing anything, it's starting to look like maybe they've hit bottom," Turner says.

Chrysler Group, which saw a 7 percent decline in sales overall for its Dodge, Chrysler and Jeep brands, is sitting on a huge inventory of vehicles, and just launched a new incentive program titled "All about the Best," running through month's end. It reported plummeting sales of its Jeep Grand Cherokee and Dodge Durango SUVs (down 21 percent and 48 percent, respectively); and Ram full-sized and Dakota mid-sized pickups (down 29 percent and 48 percent).

Chrysler is offering 0 percent financing for 60 months or cash back up to $6,000.

An example of how hard things have gotten for Chrysler Group truck business: Chrysler Group's light trucks are sitting on lots for 113 days before delivery, compared to the 84-day industry average, J.D. Power reports.

GM, meanwhile, reported that its truck and SUV sales were up 2 percent. According to the Power Information Network Ford, which saw sales increase last month over 6 percent, saw a 2 percent increase in sales of its Explorer SUV, and an 8 percent increase in sales of its full-sized Expedition utility.

Still, Ford's overall truck sales suffered because of stiff competition and crossovers and because of its aging Ranger mid-sized SUV. Sales of Ford's Escape crossover SUV, for example, were down 16 percent.

Even the Freestyle crossover, a relatively new vehicle in Ford's stable, wilted--with sales off 47 percent. Ranger, which hasn't benefited from a major redesign in years, dropped 30 percent.

"Inventories of those vehicles are so high," says Libby, "they are already discounting them."