GM’s U.S. Sales Take Breather in January

General Motors’ U.S. sales take a breather in January, declining 4.0% in a month where many of the automaker’s new-model-year vehicles arrived at dealers to limit discounting flexibility and squeeze availability of the red-hot trucks buyers continue to gobble up.

GM delivered 195,523 cars and trucks last month, compared with 203,745 in the same period last year, according to WardsAuto data. Other automakers also saw sales step back in the month, which can be a challenge because it tends to have the fewest selling days on the calendar. There were 24 this year, same as year-ago.

“In early January, we focused on profitability while key competitors sold down their large stocks of deeply discounted, old-model-year pickups,” says Kurt McNeil, vice president-U.S. Sales Operations at GM.

“We gained considerable sales momentum as we rebuilt our midsize pickup, SUV and compact crossover inventories from very low levels following record-setting December sales,” he says in a statement.

GM entered the New Year lean on key models as it turned much of its portfolio over to the ’17 model year. In a market where a 60-days’ supply is the norm, products such as the industry-leading Chevy Tahoe and GMC Yukon large SUVs, as well as the popular little Trax CUV, carried less than a 30 day’s supply into the month.

The Chevy Equinox midsize CUV and Colorado midsize pickup, two more big sellers for GM, were at less than 50.

GM saw its highly profitable truck sales rise 4.1%, which reflects the trend in the segment, to account for 74.0% of its deliveries in the month. While pickup sales weakened 3.8%, SUV demand shot up 17.7% and CUV deliveries rose 7.9%. Car sales fell 21.0%.

Chevrolet sales slipped 2.2% to 134,784 units. Deliveries of the Silverado were down 6.1% to 35,553, when the large pickup typically averages nearly 48,000 per month. Equinox was off 5.4% to 17,574 when it averages more than 20,000 per month. The same dynamic was in play for the Tahoe, with sales down 5.1% to 5,881, and Colorado with deliveries up 16.4% to 6,413, when the pair average more than 8,300 units per month apiece.

GMC demand edged up 1.1% to 37,324, led on a volume basis by the Sierra large pickup, despite a 4.5% decline to 13,734. The Yukon large SUV was the standout, rising 20.0% to 3,080.

Buick sales tumbled 28.2% to 13,117, reflecting its car-centric lineup in a market where trucks are king. Deliveries of the LaCrosse and Regal sedans, for example, dove 67.8% and 64.2%, respectively, on combined volume of a sparse 2,258 units. The Encore compact CUV once again was its flag-bearer on sales of 5,258 units, up 6.9%.

Cadillac witnessed a 4.1% sales lapse to 10,298. The all-new XT5 midsize luxury CUV was its best seller on volume of 3,883.

GM finished the month with 878,590 vehicles in stock for an eye-popping 108 days’ supply. But the automaker cites another historical quirk in a month where sales are weak and production is strong. GM also remains optimistic that demand will stay high as the year unfolds, citing a robust economy and its brands’ product launches into the market’s hottest segments.

The automaker says it plans keep its focus on retail sales and restrict deliveries to rental-car companies in an effort to boost profitability and strengthen residual values.

“Our go-to-market strategy in 2017 is the same as 2016,” McNeil says. “We are focused on strengthening our brands, growing retail sales and share, reducing daily rental deliveries and maintaining our operating discipline.”

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