Cruze transition impacts sales


By Kalea Hall

khall@vindy.com

LORDSTOWN

The Mahoning Valley’s car is in a transitional phase, and that is showing in its sales.

Sales of the Cruze, which is built by 4,500 workers at the General Motors Lordstown Assembly Plant, dropped 58.1 percent year-over-year in March 2016.

“That just goes to show the marketplace is drying up,” said Glenn Johnson, president of United Auto Workers Local 1112, which includes 3,000 GM Lordstown members. “It’s good for our business because when the new [next-generation Cruze] hits, the dealers will be able to pump them out.”

The next-generation Cruze started to ship out to dealers March 21. Many local dealers eagerly awaited the arrival of the new Cruze and had little inventory of the first-generation left to sell.

Columbiana Cadillac Buick Chevrolet was one of those dealerships.

“We came into March with no Cruzes,” said Don Brady, dealership general manager.

Brady was able to buy some from other local dealers and sold some Cruzes last month. Three of the next-generation Cruzes just came in, and one already has been sold, and the dealership can’t wait for more.

“They are coming out of the gate with really good leases on them,” Brady said. “It’s going to excite a lot of people.”

Production at the plant is progressing, Johnson said. Today, there’s a Saturday shift scheduled to meet demand.

“We are pumping right along,” he said.

UAW Local 1714 President Robert Morales, who represents about 1,400 fabrication plant workers in Lordstown, agreed that production is progressing.

“We are making sure we do things right – and do them right the first time,” Morales said.

Eric Lyman, vice president of industry insights for TrueCar, noted the importance of quality control, and that sometimes adapting to changes in tooling and manufacturing processes takes time.

“Quality control can take more time than anticipated, but that isn’t necessarily a bad thing,” he said. “The last thing you want is a stumbling out of the gate.”

Lyman does expect to see the Cruze have retail sales growth in coming months with the release of the new version. But he also expects GM’s cutback on fleet sales to increase residual values to impact the volume of Cruze sales.

In March, which had two extra selling days over March 2015, GM reported an overall sales increase of 1 percent despite reductions to fleet sales.

GM sold 193,524 vehicles in March to individual or “retail” customers, up 6 percent year over year. This was driven by a 7 percent increase at Chevrolet and a 13 percent increase at GMC.

Car sales were up 8 percent, led by the all-new Malibu, which was up 65 percent, along with the Camaro up 23 percent, the Spark up 4 percent and the Volt up 202 percent.

Ford, Honda, Fiat Chrysler and Nissan all reported big sales increases, largely driven by SUVs and trucks.

But Toyota sales fell nearly 3 percent as rising SUV and truck sales couldn’t overcome car sales that fell almost 10 percent. And Volkswagen, still mired in an emissions cheating scandal, saw its sales tumble 10.4 percent.

Yet the overall sales increase, expected to be around 7 percent, showed that Americans are still buying in big numbers, despite predictions by some analysts and dealers that sales have peaked.

Lyman said overall sales surpassed last March’s sales by 3.3 percent.

TrueCar expects sales during the first quarter to be up 4 percent over last year. Sales for the full year are expected to increase 3 percent from last year’s record-breaking sales.

Contributor: The Associated Press

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