General Motors reported its best month so far this year on Tuesday, as overall sales rose 5.4% in July compared to the same month last year. Among its four remaining core brands -- Buick, Cadillac, Chevrolet and GMC -- the Detroit auto giant said sales rose nearly 25% above prior-year levels. Retail sales, which exclude fleet and other commercial buyers, rose 18%, higher than the industry as whole, GM said.
For the month, GM sold 199,432 cars, and its Buick and Cadillac divisions each sold twice as many cars and trucks as they did in July 2009, achieving their best sales month since August 2008. July's calendar included one extra selling day compared to last year, GM noted.
"Our July results again reflect that each of our brands has contributed significantly to our gains," said Don Johnson, GM's new vice president of U.S. sales. On a conference call with investors and media, Johnson said GM continues to make progress despite a slowdown in the economic recovery. Even with talk of a double-dip recession, he said, "from our standpoint we actually see a low risk of that," barring anyone strong economic shock, such as a spike in oil prices.
Four Top Models
Within individual divisions, GM reported Buick sales rose 137% year-over-year to 16,799 units, while those at Cadillac surged 142% to 14,919 vehicles for the month. Chevrolet sales inched up 12% from last July, selling nearly 140,000 cars and trucks. GMC sold 27,798 vehicles, a rise of 27.2%.
GM said newly introduced vehicles, such as the Chevrolet Camaro sports car and Equinox SUV, and Buick LaCrosse and Regal sedans, accounted for one out of every four vehicles sold during the month.
Johnson noted that last month marked the first full year for GM as a new company, having emerged from bankruptcy last July. That reorganization resulted in GM shedding four of its eight brands. Saturn, Pontiac and Hummer are shuttered or soon will be, and Saab was sold to Dutch automaker Spyker Cars.
Higher Prices, Lower Incentives
GM said it sold 125,000 more cars so far this year with just four brands than it did during the first seven months of 2009 with eight brands. Overall, Johnson said, GM is selling more vehicles at higher prices with lower incentives. Johnson reiterated GM's expectations that the industry will sell 11.5 million to 12 million vehicles in the U.S. this year, higher than last year, but well below recent historical standards.
Separately, GM confirmed Tuesday it had invested $5 million in Bright Automotive, an Indiana-based start-up that is developing a compact hybrid vehicle for commercial use. Bright Automotive becomes the first beneficiary of GM's recently established $100 million venture capital fund intended to further develop new fuel-efficient technologies.
The companies signed an agreement last month, and GM began supplying funds this week, they said in a statement. GM and Bright Automotive intend to complete formal agreements later this year, giving GM Ventures a minority stake in Bright Automotive. In turn, the start-up will gain access to GM's technologies, including advanced engine and transmission components, for its commercial vehicle, the companies said.
What is Short Selling?
Make a profit when stocks prices fall.View Course »