Toyota’s U.S. Sales Decline Less Than Forecast; Shares Surge



April 2 (Bloomberg) — Toyota Motor Corp.’s U.S. sales fell less than analysts predicted last month as the world’s largest carmaker offered near-record incentives to spur demand. The stock rose to the highest in almost five months.

Toyota’s U.S. sales dropped 39 percent in March compared with the 41 percent decline expected by analysts in a Bloomberg survey. The carmaker’s incentives per vehicle jumped 88 percent to $1,600 from a year ago, according to

U.S. industrywide sales fell 37 percent from a year earlier, though they rose from February’s 27-year low on higher incentive spending, pent-up demand and signs the U.S. government will move to stimulate auto purchases. Honda Motor Co. and Nissan Motor Co.’s stocks also gained as they beat analysts’ expectations and took market share from U.S. rivals.

“The sales rate wasn’t as bad as we expected, and it may be we’ve finally hit the bottom,” said Wes Brown, a market researcher at Iceology, a consulting firm in Thousand Oaks, California. “People are sitting on the sidelines, waiting for a reason to get back in and buy.”

New autos sold at an annual rate of 9.86 million units, according to sales tracker Autodata Corp. of Woodcliff Lake, New Jersey. That beat the average estimate of 8.8 million of 8 analysts in a Bloomberg survey and was an improvement from February’s 9.1 million rate.

Honda’s sales fell 36 percent and Nissan posted a 38 percent decline. Hyundai Motor Co. had a 4.8 percent decrease.

Toyota rose to 3,450 yen, up 180 yen, at 9:51 a.m. in Tokyo Stock Exchange trading. Honda’s shares rose 6.7 percent to 2,635 yen and Nissan gained 9 percent to 420 yen in Tokyo.

Market Share

Japanese and South Korean carmakers sold 404,084 cars and light trucks, down 33 percent, compared with 379,814 for Michigan-based General Motors Corp., Ford Motor Co. and Chrysler LLC. That boosted Asian brands’ U.S. market share to 47.1 percent, according to Autodata.

Incentive spending on each sale jumped 30 percent from a year earlier to $3,169 as carmakers tried to entice consumers, research firm said. That eclipsed the mark of $3,146 set in September 2004. The average sticker price of a Toyota vehicle is $29,360, according to

Hyundai’s “assurance” program, begun in January when it agreed to let customers who’ve lost jobs return vehicles they can’t make payments on, sparked similar programs by GM and Ford this week. Such offers appear to be helping, Brown said.

“Hyundai has for the most part said they’ve seen increased traffic, but not necessarily increased sales,” he said. “But getting people back into dealerships right now is a big deal.”


Toyota’s Bob Carter, U.S. vice president of Toyota brand sales, said California in particular picked up in March compared with February, when sales in the most populous U.S. state plunged 51 percent from a year earlier.

“I was pleased that all month California improved,” Carter said in a conference call yesterday. Still, a 1 percentage point rise in state sales taxes that took effect April 1 may have contributed to that,” he said.

Toyota’s U.S. inventories appear to be at “manageable levels,” Efraim Levy, a New York-based equity analyst for Standard & Poor’s, said yesterday in a research note. He has a “hold” rating on Toyota’s American depositary receipts.

Market share for Toyota, second in U.S. sales behind GM, dropped 0.5 percent to 15.5 percent, according to Autodata.

Honda, Nissan

U.S. deliveries last month for Honda and Nissan both exceeded projected declines of 42 percent, according the Bloomberg survey. Tokyo-based Honda, Japan’s second largest automaker, sold 88,379 vehicles, down 36 percent from a year ago. Nissan’s sales dropped 38 percent to 66,634. Toyota City, Japan-based Toyota sold 132,802 vehicles last month, down from 217,730 a year earlier.

Hyundai, South Korea’s largest automaker, sold 40,721, down 4.8 percent from a year earlier. The Seoul-based company raised sales 0.5 percent in the first quarter, boosting its market share to 4.3 percent, or 1.6 percentage points, the industry’s biggest gain this year.

Kia Motors Corp., a Hyundai’s affiliate, sold 24,724 vehicles, down just 0.6 percent.

Consumer confidence remained near a 42-year record low for the month, according to an index released yesterday by the New York-based Conference Board. The March reading was 26, up from 25.3 in February, the lowest since data began in 1967.

By Alan Ohnsman and Mike Ramsey



Related Post Obama Gives Automakers a Short Lifeline


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