GM’s June Sales Slip on Weak Car Demand, Rental Activity

General Motors’ U.S. daily sales in June tumbled 6.9%, as continued brisk truck and CUV sales could not offset weakness on the car side and fewer deliveries to rental-car companies.

The Detroit automaker sold 259,353 vehicles last month, compared with 267,461 in the same period last year, according to WardsAuto data. The automaker’s year-over-year daily sales results also were drawn down by an extra selling day vs. year-ago.

“We just wrapped up the U.S. auto industry’s best six months in a decade, driven by strong demand for pickups and (CUVs),” Kurt McNeil, vice president-U.S. sales at GM, says in a  statement.

“People feel good about their jobs and the direction the economy as a whole is taking, so the second half of the year should be strong, too,” he says.

McNeil expects the next six months to unfold positively for the automaker because consumers are snapping up trucks and CUVs, which plays to the strength of GM’s current product portfolio.

So far this year, GM has delivered 1.51 million vehicles, up 3.4% from 1.46 million units in like-2014 and against an industry 4.4% ahead of last year.

However, GM’s market share in June declined sharply to 17.6% of industry sales. Last year, GM controlled 18.9% of U.S. sales. The automaker cites fewer sales to fleet buyers, especially rental-car companies.

GM expected its rental deliveries to decline last month, citing a plan to focus its fleet sales on the commercial and government side of the business. The automaker’s fleet mix was 20% in June. Historically, it is about 25%, a GM spokesman says.

The automaker says it will continue to pull back on rental sales, typically the least-profitable business for the industry, as its big sellers in the segment go out of production and GM puts greater emphasis on retail sales of coming redesigned products such as the Chevy Cruze and Malibu. The Cruze and Malibu have been popular among rental companies.

GM’s car sales in the month reflected the change in its fleet strategy, but also a further strengthening of consumer preferences toward trucks and CUVs from small and midsize cars. The automaker’s truck sales rose 1.1% last month, while car deliveries were off 20.2%. So far this year, truck sales are up 15.8% and cars are down 15.4%.

Stronger products for GM last month included the Chevy Silverado large pickup, which saw sales rise 13.7% to 51,548 units. Overall, Chevy sales fell 7.7% in June, with the Cruze, Malibu, Impala and Spark posting losses. Sales of the Camaro sports car, however, rose 7.1%.

Chevy Tahoe and Suburban SUV sales witnessed sharp year-over-your declines, with GM citing a focus on filling the retail channel and general demand outpacing production capacity. The two trucks combined for 65,477 deliveries last month.

GMC sales edged up 3.7% to 47,051, lifted by a 16.0% surge in Sierra large pickup deliveries to 18,618. Buick sales fell 21.4% to 17,531, despite a 28.1% upswing in demand for the Encore compact CUV on volume of 5,526 units. Cadillac deliveries slid 6.9% to 13,515, although the SRX 5-passenger CUV handed in a record June volume of 5,746 copies, up 18.6%.

GM closed the month with 722,653 vehicles in stock, good for a 70 days’ supply, compared with 714,744 and a 63 days’ supply last year.

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