While overall U.S. car sales appear to have jumped again in July, it wasn’t a good month for two of the Big Three Detroit makers. Japan’s top two manufacturers, on the other hand, saw the price paid by the typical buyer surge to record levels.
NBCnews.com reported that industry analysts will be watching closely in the weeks to come to see if the market can maintain the momentum it had shown during the first half of the year.
The weakest numbers came from General Motors and Ford, both of which reported sales dropped during July – though domestic rival Chrysler posted a 13% sales increase compared with the same month a year ago.
GM reported its sales dropped 6% as it cut back on sales to rental fleets. Ford posted a 4% decline, largely due to reduced sales to fleet customers. Both automakers have signaled their decision to reduce those low-profit sales practices but the impact has been significant.
With some automakers still waiting to report, market share numbers for July aren’t yet available. But for the first six months of 2012, GM’s share slid to 18.1% compared to 19.9% during the same period a year earlier. Ford’s share, meanwhile, dropped from 16.9% to just 15.7%.
Among the first of the Japanese automakers to report for July, Nissan posted a 16.3% increase in sales for July, while Volkswagen posted a 27% sales increase.
A significant factor in the market has been a steady decline in incentives. At the same time, Average Transaction Prices – ATP, or the price the typical customer pays – has been rising. Toyota and Honda both set records last month, reported TrueCar.com, an authority on car pricing, trends and forecasts.
TrueCar estimated the average transaction price for light vehicles in the United States was $30,369 in July 2012, up $487 (1.6%) from July 2011 and down $139 (0.5%) from June 2012.
“Even though automakers may give the impression that they are ramping up incentives spending, the very low cost of funds and historically high resale values are in fact enabling them to create a ton of noise with fewer actual dollars spent,” said Jesse Toprak, vice president of market intelligence for TrueCar.com. “Manufacturers are increasingly moving away from cash incentives and pushing finance and lease programs.”