GM’s 2011 Sales Gains Provide First Market-Share Bump in Years
The auto maker estimates its share of the U.S. market grew 0.5% to about 19.3% last year, marking its first year-on-year gain since 2002.
General Motors posts a 13.2% U.S. sales gain in 2011, including an uptick in December deliveries of 4.6%, closing the book on year where the restructured auto maker witnessed its first annual market-share gain in a decade.
GM sold 2.5 million cars and trucks in 2011, up from 2.2 million units in 2010, according to WardsAuto data. December deliveries totaled 234,351, compared with 224,147 in like-2010.
GM estimates, before all auto makers have finished reporting December results, that its share of the U.S. market grew 0.5% to about 19.3% in 2011. The company last reported a year-to-year share gain in 2002, when its piece of the market grew 0.2% to 28.6% from 28.4% in 2001, WardsAuto data shows.
“You can see clearly that our balanced portfolio of fuel-efficient cars, trucks and crossovers helped us make the most of the U.S. economy’s slow but steady recovery,” says Don Johnson, GM’s chief sales analyst.
“And we’re very well-positioned to compete in a market that we expect to keep growing in 2012,” Johnson tells journalists and Wall Street analysts during a conference call to discuss the auto maker’s December and year-end sales results.
The market-share gain represents a win of sorts for GM. The auto maker shed four brands during its 2009 bankruptcy, emerging with a 4-division game plan and product lineup relying less heavily on sales of less-fuel-efficient pickups and SUVs.
GM also swore off over-producing and steep discounting to move often bloated inventories.
Since bankruptcy, GM has launched a number of new passenger cars, including the Chevrolet Cruze compact that occupied the No.1 spot in its segment for five consecutive months in 2011. The Cruze accounted for 231,732 sales last year.
The auto maker continues to work to meet demand for its Chevy Equinox and GMC Terrain midsize cross/utility vehicles, which combined to deliver 276,000 units last year.
GM will add production of the CUVs to its idled Spring Hill, TN, assembly plant later this year to supplement a facility in Ingersoll, ON, Canada, which is running at three shifts with overtime and still unable to build enough.
The auto maker’s trucks continued to take advantage of relatively low gasoline prices and customers needing to replace their work vehicles, as the Chevy Silverado and GMC Sierra pickups combined for an industry-best 563,340 light-duty sales in 2011.
However, GM’s 2011 deliveries continued to reflect recession-like levels, down 1.2 million units from 2007. And despite its production and pricing discipline, the auto maker remained the industry’s biggest spender on incentives, according to third-party estimates.
GM also arguably failed to take full advantage of Asian rivals weakened by last year’s earthquake and tsunami in Japan, which capped inventories and limited their aggressiveness in the market. Toyota, Honda and Nissan are expected to be back full strength next year looking to regain share.
Johnson says a plodding comeback to the U.S. economy will allow GM to stick with its game plan in 2012.
“Our plan is to maintain that (pricing) discipline,” he says, adding “one of the benefits of a predictable state of growth is that you can plan without adding huge lumps of capacity at any given time.”
Johnson downplays the renewed strength of the Japanese auto makers, suggesting the greater presence could bring buyers back into the market and offer GM a chance to win them over.
“We will get a shot at them,” Johnson says, predicting incentive action will remain subdued. “I don’t expect our competition to do anything irrational in the market place, and up to this point we have not seen that.”
GM forecasts industry sales in 2012 of between 13.5 million and 14.0 million light vehicles, up from an estimated 12.8 million in 2010.
Johnson predicts pent-up demand, which built as consumers held off purchases during the recession, will continue to drive sales. An economy that adds more jobs in 2012 would provide upside to the auto maker’s forecast, he says.
GM opens 2012 with about 583,000 total units of inventory, with about 219,000 passenger cars and 365,000 trucks and CUVs.
The auto maker’s controversial Chevy Volt extended-range electric vehicle, which became subject to a federal safety investigation in November, sold 1,529 units in December. The result marked its best monthly performance since its launch in late-2009.
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