Automakers Hope To End May on a High Note With Memorial Day Sales
May 25, 2007

Automakers apparently hope to end what looks to be a flat-to-down month of sales in May on a high note by announcing Memorial Day sales that actually run through the end of the month.

General Motors’ "Memorial Day Sale" campaign, announced Thursday, runs through May 31. GM is offering zero percent financing deals for 36 months and a $1,000 bonus on several Buick, Chevrolet, GMC and Pontiac vehicles in its lineup, including large pickup trucks and SUVs from the 2006 and 2007 model years. GM is also offering zero percent financing for 60 months on three Saturn models  -- the Vue SUV, Ion small car and Relay minivan. Separate sales incentives on GM's luxury Cadillac, Hummer and Saab brands will also be available.

On Wednesday, Ford began offering a $1,000 rebate on certain Ford F-Series Super Duty pickup trucks, specifically regular and super cabs, through the end of the month. Ford just launched the redesigned Super Duty truck as a 2008 model-year product.

The rebates, of which more are likely to be announced, come on the heels of dismal April sales and, as Edmunds.com predicts, a flat-to-down May during this normally brisk sales time.

New vehicle sales, including both retail and fleet sales, are expected to come in at 1.48 million units when May sales figures are announced next Friday. That’s down from last May, according to Edmunds.com.

This May had 26 selling days, one more than May 2006. When adjusted for this difference, sales decreased 4.2 percent from May 2006. On an unadjusted basis, sales this May are down 0.3 percent.

Jesse Toprak, Edmunds.com’s executive director of Industry Analysis, says it appears consumers are taking a conservative approach to car buying as gas prices climb.

The housing slump surely is hurting pickup truck sales. Ford F-Series sales were down nearly 14 percent through April compared to the same period in 2006; a third-plus F-Series sales are Super Duty models, some of which now have incentives on the redesigned 2008 model.

Similarly, Citigroup auto analyst Jon Rogers in a memo obtained by Dow Jones this week said his data collected through mid-May also indicated "the industry as a whole shows signs of retail weakness, with a majority of automakers' showing negative comparisons."

Nissan-Renault chief Carlos Ghosn, in Detroit to deliver a speech this week, said he expected the U.S. market to weaken this year, with the weak housing market and rising gas prices depressing sales. Edmunds.com forecasts Nissan's sales will be down 1.8 percent in May, despite new models after a long dry spell. Still, Edmunds.com predicts Nissan's market share will hold steady from last month and edge up from a year ago.

In fact, a GM spokesman said the automaker’s Memorial Day sale is designed similar to other selling events such as the Presidents Day Sale and the Red Tag Year-End Event to stimulate sales during traditional automotive selling windows.

However, Edmunds.com is noticing a shift in the year’s best selling seasons. March of 2006 was the best month of last year and March 2007 may wind up being the strongest sales month of this year, Toprak predicts.

Posted by Michelle Krebs at 7:39 AM under Analysis , Featured , Ford , GM , News | Comments (0) | digg this | Seed Newsvine