As car sales increase, there’s reason for optimism here

The state of the nation was never quite as simple as what’s good for GM is good for the country, and besides, that’s not exactly what GM President Charles Erwin Wilson said nearly 60 years ago. But clearly, when the automobile industry is doing well in the United States, its a sign that something is going right.

And so the January figures for U.S. auto sales provided good news for the country at large, and the role that the Chevrolet Cruze played in the General Motors figures was particularly good news for the Mahoning Valley.

GM dealers sold 178,896 vehicles in the United States last month, an increase of 23 percent over the same month a year earlier. And about one in eight of those cars was a Chevrolet Cruze, the company’s compact car that was launched from the Lordstown plant last summer.

Those 22,314 cars being sold coast to coast represent a healthy shot in the arm to the Mahoning Valley economy. Cruze sales are supporting about 4,500 workers on three shifts at the Lordstown plant and thousands of additional spin-off jobs.

The best January in years

But beyond that, all the auto sales numbers for January were encouraging. As the Associated Press reported, sales of cars and light trucks in the United States rose 17 percent from a year earlier to 819,895. That’s still below the 1 million sold in January 2008, before most people felt the impact of the recession, but better than the last two years, when January sales fell below 700,000.

GM and Chrysler Group LLC both had 23 percent increases, while the third domestic company, Ford Motor Co., showed a 9 percent increase. Toyota Motor Corp. sales rose 17 percent; Hyundai Motor Co., 22 percent; Honda Motor Co., 13 percent; Nissan Motor Co., 15 percent, and Kia Motors, 26 percent.

Car sales are a strong indicator of consumer confidence, and increasing sales in January could be an indicator of even better things to come. That said, short term sales in February could be affected by bad weather. Even more troublesome is the potential longer term effect on the economy of upheaval in the Middle East.

Still, for now we can celebrate GM’s success and especially that of the Cruze. A significant but often overlooked statistic is the healthy increase in the percentage of Cruzes being sold to individuals rather than fleet sales. Ninety percent of the Cruzes are being bought privately, while more than half of Lordstown’s Cobalts went to fleet sales. Individual sales are better for the corporate bottom line and for local dealerships. Fleet sales are often done at deep discounts and sometimes through deals made between auto producers and fleet buyers to avoid having to slow down or stop production lines.

And while no one wants to see fuel prices go higher, if prices at the pump go up, sales of the high-mileage economical Cruze can be expected to do likewise.