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Cruze Sales Drop Nearly 28% in April
DETROIT – Deliveries of the Chevrolet Cruze were down 27.6% in April from a year earlier, General Motors Co. disclosed in its monthly results Tuesday.
GM dealers last month took delivery on 18,205 units of the Lordstown, Ohio-produced vehicle, compared with 25,160 in April 2010. Year-to-date, deliveries are on par with 2011. For the first four months of 2012, GM delivered 75,288 Cruzes to dealers, down slightly from 75,365 during the same period a year earlier.
Don Johnson, vice president, U.S. sales operations, and Alan Batey, Chevrolet vice president, downplayed the drop in Cruze sales during a conference call with analysts and reporters Tuesday.
Cruze sales need to be looked at on an annualized basis rather than just on a single month, Johnson pointed out.
“The compact car segment is obviously a very competitive segment,” Batey said. “What we have done from Day One is to position Cruze from a value perspective because it does offer incredible value for money.” As Japanese competitors have come back into the market, GM has remained “extremely disciplined” with regard to price, he continued, pointing to the Totota Corolla’s average transaction price of $16,917 compared with the Cruze’s $19,572.
“You can see that we’re not getting drawn into a discounted sales position,” Batey said. “We’re driving great sales with great retail penetration because people are seeing the value in our product, and we’re committing to do that for the long haul.”
Overall, GM sold 213,387 units in April, down 8.2% from 232,538 from a year earlier, a drop Johnson attributed in part to a 25% decline in fleet sales while retail sales remained about the same. April 2011 retail sales were “unusually high” due to the timing of rental car deliveries last year, he said.
“When you look at the absolute reduction in year-over-year fleet deliveries, it was about 19,000 units,” and about half of that was vehicles GM no longer produces, he said. Retail sales of small and compact cars were up 18% for the month and midsize cars were up 8%.
As a division, Chevrolet had its second-best retail sales month since the federal government’s Cash for Clunkers’ program, he said.
Johnson noted that April had three fewer selling days, including one fewer weekend. When adjusted for selling days total sales were up 3% and retail sales up 12%.
Based on higher than expected first quarter industry sales and expectations that the U.S. economy will continue to grow, GM increased its full-year light vehicle sales forecast to 14.0 million-14.5 million from 13.5 million-14.0 million units.
Copyright 2012 The Business Journal, Youngstown, Ohio.