US car sales dip in June as confidence fades

US car sales softened unexpectedly in June under the weight of deteriorating consumer confidence and tight supplies in the wake of disruptions caused by the Japanese earthquake.

“Some consumers have decided to sit on their hands and delay purchases,” said Don Johnson, General Motors’ head of North American sales operations. Ford Motor ascribed the setback partly to delayed purchases in California, where a sales tax cut took effect on July 1.
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Mr Johnson expressed confidence that “the recovery will get back on track”. He cited, among other factors, a return to normal inventory levels and easier credit conditions.

Ken Czubay, Ford’s US marketing chief, expressed “cautious optimism” on the basis of mixed economic data.

Total light-vehicle sales dipped to 11.5m units at a seasonally adjusted annual rate, from 11.8m in May, according to Autodata. That measure topped 13m in each of the previous three months. Most analysts had forecast June sales at 12m units or more. Sales stood at 11.1m in June 2010.

GM reported a 10 per cent gain last month compared with a year earlier. Ford Motor was up 14 per cent while South Korea’s Hyundai reported record June sales.

By contrast, Toyota’s sales were 21 per cent lower than a year earlier, but up on May. Don Esmond, head of automotive operations at Toyota’s US arm, said June marked a turning point in recovering from the earthquake-related disruptions.

“Toyota dealers now have a good supply of cars and trucks, and that selection is growing everyday”, he said.

Three Detroit-built sedans – GM’s Chevrolet Cruze and Malibu and Ford’s Focus – overtook the Toyota Camry as the US’s top-selling car.

The Camry has held the number-one spot for most of the past decade. Camry sales were down a quarter from June 2010.

Chrysler, controlled by Italy’s Fiat, had its best June in four years, with sales up almost a third from last year.

GM and Ford said they had noticed a reversal in recent weeks of the earlier trend away from gas-guzzling pick-up trucks and sport-utility vehicles in favour of fuel-efficient cars.

One silver lining for the industry is that earthquake-related shortages have enabled carmakers to push up prices. TrueCar.com, an online pricing service, estimates that the average new-vehicle transaction price reached an all-time record in June, up 2.9 per cent from a year earlier.