General Motors productsLynne Sladky
General Motors Co. posted a 3.5 per cent increase in October U.S. sales on Wednesday, trailing smaller rivals for a month expected to represent the high point in a slow-moving recovery for the industry.
GM, which is expected to provide pricing details and launch a road show to market a planned initial public offering to investors as soon as Wednesday, said sales rose 12.8 per cent in its four core brands of Chevrolet, Cadillac, Buick and GMC.
U.S. auto sales sank to the lowest levels in more than a quarter century in 2009 under the severe recession and so far this year have been recovering at a slower pace than the industry or its analysts expected.
Auto makers are expected to report the strongest U.S. sales rates of the year in October, but sales overall remain well below pre-recession levels of 2007 and are expected to continue a slow pace of recovery along with the U.S. economy.
GM's total vehicle sales, about in line with expectations, are expected to lead the industry in October. A handful of auto makers reported U.S. sales on Tuesday, a U.S. election day. The top six by sales volume report sales on Wednesday.
"We don't see a big risk at all of a double-dip," GM's U.S. sales chief, Don Johnson, told reporters on a conference call.
He said consumers have begun to hold on to vehicles longer than in the past in a fundamental shift in buying habits, but GM is confident it has restructured its business to run profitably even in a slower-growth market.
Mr. Johnson declined to discuss GM's IPO plans.
GM's smaller rivals had bigger percentage gains.
Ford Motor Co. sales rose 19 per cent in October from a year earlier, led by pickup trucks. Chrysler Group LLC's sales rose 37 per cent and Honda Motor Co. Ltd. reported a 16 per cent sales increase.
Chrysler's sales increase represented the seventh consecutive month of year-on-year gains from the prior year when it emerged from a government-funded bankruptcy under the management control of Italy's Fiat SpA.
Nissan Motor Co. said its U.S. sales rose 16.1 per cent in October from a year earlier. Toyota Motor Corp. reports later on Wednesday.
On Tuesday, South Korea's Hyundai Motor Co. said its U.S. sales rose nearly 38 per cent while its Kia Motors affiliate posted a nearly 39 per cent increase.
Volkswagen AG, Audi AG, Bayerische Motoren Werke AG, Subaru and Porsche Automobil Holding SE also reported sales increases in October from a year earlier on Tuesday.
Over all, economists polled by Reuters expected U.S. auto sales at a seasonally adjusted annual rate of about an 11.85 million vehicles, well off the 16 million vehicle monthly rates routinely registered in 2007 before the U.S. recession.
GM said it expects the annualized sales rate for October to be about 12.1 million light vehicles. Chrysler estimated the sales rate at closer to 12.4 million vehicles.
That would represent the first time the rate had topped 12 million since the Lehman bankruptcy in September, 2008, excluding August, 2009, when the U.S. government's "cash for clunkers" incentive program boosted results.
For 2010 over all, the industry is expected to post U.S. sales of about 11.5 million light vehicles, up from 10.4 million last year. The industry is expected to have moderate gains from there in 2011, to about 12.8 million vehicles, according to IHS Automotive.