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Cruze sales weak in December but strong in 2013
YOUNGSTOWN
Though sales of the Lordstown-built Chevrolet Cruze dropped in December, the compact car rounded out a record year, with sales up 4.4 percent from 2012.
The Cruze sold 18,162 units last month, a 14.5 percent decrease from 21,230 units sold during the same month in 2012, according to figures released Friday by General Motors Co.
The disappointing December results were not completely unexpected, due to seasonal and industry trends, said Michele Krebs, a senior analyst for Edmunds.com. Harsh weather, low gas prices and better gas efficiency in larger vehicles favored sport utility vehicles and trucks as the seasons turned.
The Cruze also has faced competition within the Chevrolet line from the redesigned 2014 Malibu and Impala, which saw December sales rise 33.2 percent and 10.3 percent, respectively, in December.
But Cruze sales for the year registered at 248,224 units, a 10,466-unit bump from 2012 sales. 2013 ranks as the highest sales year for the car, which was introduced in 2010.
The Cruze also remained Chevrolet’s second-best selling model, trailing only the Silverado pickup, which moved 480,418 units in 2013.
The Silverado is poised, along with the GMC Sierra, to battle the new Ford F150 pickup in 2014 for the sales crown in that segment.
Across all GM brands, retail sales slid by 6 percent in December. Meanwhile, fleet sales fell again, reflecting a conscious shift by major automakers to focus more on retail sales than on fleet deliveries, such as those to rental-car companies, cities and businesses.
In a statement, GM touted a successful overall year for both the company and the industry as a whole.
GM delivered nearly 2.8 million vehicles in 2013. Retail sales increased 11 percent, and total sales increased at a rate of 7 percent compared to 2012.
Auto analysts expected a 2013 sales total of about 15.6 million for the industry, once all the results came in.
“2013 was the year that GM and the auto industry put the last traces of the recession in the rearview mirror, so now we can devote our full attention to the things that matter most to customers: compelling design, world-class quality and delivering the best ownership experience in the business,” Kurt McNeil vice president of U.S. sales operations, said in the press release.
Krebs agreed with the GM assessment, saying she thought the year-end results showed “the industry was on solid footing” amid higher demand in the market.
GM seized the opportunity to rebrand itself after the recession, offering new models and making its vehicles competitive moving into the future, said Eric Lyman of the market tracker TrueCar.com.
As for the Cruze, GM has positioned the compact car well to compete in one of the industry’s most-competitive segments, Lyman said.
When production was down, he said, the company took advantage of incentives to “move the metal,” and the decision has paid off.
But Lyman said GM faces another important decision in 2014 about the Cruze, one of the oldest models in its fleet.
“They can keep incentives going, or dial back production and let sales increase,” now that the car has gained in reputation and popularity, he said.
Based on his experience, Lyman said the latter has traditionally been the better strategy, getting the customer to focus on the vehicle itself, instead of the price.
GM’s course over the next year remains to be seen, as the Cruze is set to get an upgrade sometime in 2015 or 2016.
At the Lordstown facility where the Cruze is manufactured, GM and United Auto Workers union representatives have remained tight-lipped about a new Cruze model, but Glenn Johnson, UAW Local 1112 president, said he was happy with the rate of production over the last year.
While workers maintained three shifts, five days a week as they did in 2012, they also gained a Saturday of production in 2013.
“We’ve been steady,” said Johnson, who represents workers in the assembly plant.
“I don’t know what the demand holds in the future, but I hope people keep buying them,” he said.