Cruze expected to hold its own in 2016

January 6, 2016 at 12:02a.m.

LORDSTOWN

Leaders of the local United Auto Workers unions both speak with optimism about the future of the Lordstown-built Chevrolet Cruze.

After five years of competing in a highly competitive segment and market, the Cruze took a 17 percent hit in year-over-year sales in 2015.

“It is reflecting of the trends right now,” UAW Local 1112 President Glenn Johnson said.

Johnson represents thousands of workers at the General Motors Assembly Plant.

UAW Local 1714 President Robert Morales, who represents the fabrication plant workers in Lordstown, believes the excitement surrounding the next-generation Cruze has customers waiting to buy and isn’t concerned about the competition out there.

“I think we established ourselves in the market,” Morales said. “I felt great about the first generation, and as we move toward the future, I feel great about the next-generation Cruze. We are committed to building the best-quality car, and we know we will be successful.”

On Tuesday, GM released its December sales and yearly sales. The Cruze’s sales fell short in December, from 17,800 to 16,849, a 5.3 percent drop.

For the year, Cruze sales dropped 17 percent, from 273,060 to 226,602. In 2014, the Cruze had its best-ever annual sales after being on the market since 2010.

GM’s four brands – Chevrolet, Buick, GMC and Cadillac – had a combined 290,230 sales in December 2015, driven by an 8 percent year-over-year increase in retail deliveries. Total sales were up 6 percent from December 2014.

For the year, dealers sold 3.1 million vehicles, driven by an 8 percent increase in retail deliveries compared with 2014. Total sales were up 5 percent.

Larger vehicles, including the Chevrolet Silverado and the Equinox, outshined the brand’s cars.

“The momentum that the Chevrolet Silverado and GMC Sierra have carried all year, hits like the Chevrolet Trax and Colorado, and innovative designs like the GMC Canyon and Buick Encore have had a tremendous positive impact on our sales results,” said Kurt McNeil, GM’s U.S. vice president of sales operation.

Larger vehicles were on trend all last year and are expected to stay on trend this year. In fact, this is the first year the compact-sport-utility segment surpassed sales for car segments.

“We don’t see any change,” said Michelle Krebs, senior analyst for Autotrader.com, on the trending larger vehicles. “The new products in the marketplace will not bump the whole segment’s [sales] up.”

The next-generation Cruze, which is expected to hit sales floors this spring, isn’t the only new compact car making its debut this year. A top competitor, the Honda Civic also will be out on the market, and there will be a refreshed Hyundai Elantra.

“They are still very relevant,” said Eric Lyman, vice president for industry insights at TrueCar, about compact cars. “They are still very important in the fleet world as well.”

The next-generation Cruze is a sleek, lighter, yet larger version of the current model with enhanced safety and technology features. Automotive News also has confirmed there will be a hatchback version of the Cruze unveiled at the Detroit auto show next week. Other details about the hatchback version haven’t been released.

On Tuesday, analysts were pretty positive the yearly sales record would be broken by automakers. Sales were expected to hit 17.5 million, which would surpass the former record of 17.35 million set in 2000, when the industry wasn’t as healthy as it is now.

“Overall, the transaction prices and revenue for automakers has grown significantly in 2015 versus 2000,” Lyman said.

Ford’s December sales totaled 239,242 vehicles, up 8 percent from December 2014. An 8 percent retail sales increase drove overall performance, with 174,509 vehicles sold last month.

The automaker’s total 2015 U.S. sales of 2,613,162 vehicles were the company’s best annual sales results in nine years.

Fiat Chrysler Automobiles U.S. reported U.S. sales of 217,527 units, a 13 percent increase compared with sales in December 2014. For the year, Fiat Chrysler posted a 7 percent gain in sales over 2014 with 2,243,907 sales.

American Honda Motor Co. reported a 9.9 percent sales gain in December and record annual sales of 1,586,551 Honda and Acura vehicles for 2015, an increase of 3 percent.

This year, analysts expect to see even more sales. More than 18 million sales are expected, which would mean this year would be the seventh-consecutive year of growth for the auto industry.

“We are getting some great momentum going into 2016,” Lyman said.