The still-sputtering economy which continues to be undermined by high unemployment and low home prices has not arrested a tremendous revival of car sales. In 2008 and 2009, national sales barely averaged 10 million, down from over 16 million in both 2005 and 2006.
There are several theories about the car sales recovery. One is that Americans have held their new cars for a record number of months. This theory says that those aged models now need replacing. Another theory is that car low rates are low–sometimes 0%. This has been an enticement to bring buyers back into the market.
Whatever the reason, major car companies have started to report February sales.
Chrysler said its sales rose 40% compared to the same month last year to a total of 133,521 vehicles. Chrysler declared government assisted Chapter 11 in 2008. There was doubt about its survival because it was and is so much smaller than rivals GM (NYSE: GM) and Ford (NYSE: F). But, Chrysler’s controlling shareholder Fiat has done an impressive jobs of turning it around.
GM’s sales rose 1% to 209,306 vehicles. Despite the modest increase, it is still the market share leader in the US. Ford sales were up 14% to 179,119 vehicles.
VW, which has lagged in US sales despite being the second largest car company in the world said that 43% to 30,577 vehicles
Douglas A. McIntyre
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