May 20, 2009
Chrysler sales outpacing rivals
Chrysler LLC, working to shed most of its assets in bankruptcy, is selling cars at a higher rate than the U.S. industry this month as incentives of as much as $6,000 on each vehicle attract buyers.
Chrysler’s U.S. sales fell about 30 percent through May 18, less than a drop of as much as 33 percent for all automakers, said Gary Dilts, senior vice president of consumer-research firm J.D. Power & Associates, which collects data from 6,000 dealers.
The results are a win for Auburn Hills, Mich.-based Chrysler in its bid to keep revenue flowing and cut inventory until it exits court protection. The demand for Chrysler, Dodge and Jeep autos eased concern that bankruptcy would scare off consumers.
“We had a pre-bankruptcy target to hit, and it looks we are seeing pretty close to the industry for the month,” Steve Landry, Chrysler’s U.S. sales chief, said in an interview today. “It’s developing fairly well.”
Chrysler’s experience may also be good news for General Motors Corp., which faces a probable bankruptcy by June 1, the deadline set by President Barack Obama for the biggest U.S. automaker to restructure outside of court.
With U.S. auto sales plunging earlier in 2009 to the worst annual rate in 27 years, an automaker’s ability to outpace the market now counts as a victory, even with declines of 30 percent or more from a year earlier. Chrysler’s sales tumbled 48 percent last month as its April 30 bankruptcy filing neared, eclipsing the U.S. industry’s 34 percent slump.
J.D. Power, based in Westlake Village, California, collects information from dealers as they make sales. Automakers typically don’t discuss their sales in detail in mid-month.
Chrysler’s goal is to drive down its supply of unsold cars, Landry said. The company’s factories will remain shut until mid- June or later, he said. By the end of June, its inventory may be 250,000 autos, 43 percent less than a year earlier.
Landry credited the company’s sales performance to the incentives and Obama’s assurance in a nationally televised address that Chrysler would survive.
Mickey Anderson, president of Performance Automotive Group in Omaha, Neb., said his Chrysler store there “is on pace” to outsell his Toyota Motor Corp. and Ford Motor Co. outlets.
“President Obama helped release a little bit of pent-up demand by clearly stating, ‘They are going to make it,’” Anderson said.
LINK:Chrysler sales outpacing rivals | APP.com | Asbury Park Press