Jerry Hirsch, Los Angeles Times, Published September 04 2013
Not enough cars to sellLOS ANGELES – Strong August auto sales numbers revealed a problem last month that Ford, General Motors and Chrysler once would have begged for – not enough cars to sell.
All three automakers posted double-digit gains in sales last month, and they reported tight inventories on some models.
For Ford Motor Co., it’s the Fusion sedan and Explorer and Escape crossovers; they just can’t build them fast enough. In Los Angeles, San Francisco and Miami, a Fusion is lasting just 13 days at a dealership before being sold. Typically cars can sit on a lot for two months.
At Luther Family Ford in Fargo, General Manager Joel Bechtold said his dealership sees the same pattern in demand for those models.
Nationwide, Chevrolet has only a 35-day supply of its Cruze and can sell every unit of its newly redesigned Impala it makes.
At Gateway Chevrolet in Fargo, General Sales Manager Jon Cole said his Fargo dealership is selling out of the Impalas at lightning speed. The redesign led to several national accolades.
The Cruze’s debut in 2011 also helped sales. Of the 17 Cruzes on the Gateway lot, only two have been on hand for 30 days, Cole said.
“We had one of our best new-car months last month,” Cole said.
Nationwide, Chrysler needs more Jeeps and Fiat 500Ls.
At Corwin Chrysler Dodge Jeep in Fargo, General Manager Casey Lindgren said there is “pent-up demand” for the Jeep Cherokee, a perennial consumer favorite, and for Dodge Ram trucks and the SUV line of Dodge Durangos.
The 2013 debut of the Dodge Dart amped up national interest in Dodge’s only compact sedan model, and metro consumers’ interest was piqued as well.
“We didn’t have a comparable model before, so it’s helped,” Lindgren said of the Dart. “Also, Dodge Avenger sales are up 300 percent year after year.”
While Ford’s F-150 pickup has always dominated the market – and makes up 50 percent of Luther’s sales – high gas prices caused consumers to put a priority on good fuel economy, even in this area, Bechtold said.
“People want the room, and they want the mileage,” he said.
It’s quite a turnabout for the domestic brands, which just five years ago had to offer huge discounts and incentives to move vehicles out of showrooms.
“Keeping things on the lean side is a much better place to be,’ said Jeff Schuster, an analyst at LMC Automotive.
They might miss out on some sales, but that sure beats offering the friends-and-family discount to everyone with a driver’s license.
It’s a conundrum for the automakers.
“You don’t want to go back to the bad old days when you had too many cars to sell, but you also want to have enough inventory so that customers can find the vehicles with the options they want,” said Elaine Kwei, an analyst at the Jefferies investment firm.
Ford plans to increase production by about 50,000 vehicles during the fourth quarter, a 7 percent increase from the same period a year earlier.
Bechtold said the new plant will allow his dealership to meet the Fusion demand.
TrueCar.com estimated that U.S. auto sales reached about 1.5 million vehicles last month, up about 14 percent from the same month a year earlier.
GM said it sold 275,847 vehicles in the U.S. last month, up 14.7 percent compared with the same month a year earlier.
Ford said it sold 221,270 vehicles in August, a 12.2 percent increase from the previous year.
Chrysler Group said it sold 165,552 vehicles in the U.S. last month, a 12 percent gain from the same month a year earlier.
Toyota Motor Corp. said it sold 231,537 vehicles in the U.S. last month, a 22.8 percent increase from August a year ago.
Nissan Motor Co. said its U.S. sales hit 120,498 vehicles last month, a 22.3 percent gain and an August record for the Japanese automaker.
Forum reporter Wendy Reuer contributed to this report