After setting its third consecutive annual sales record, Subaru will aim for a fourth with new models like the BRZ sports car.
Carmakers celebrated another 10% gain in car sales for 2011 as they finished the year with sales at the best level in years. There were a few notable exceptions, however, as two of Japan’s three largest makers wrapped up 2011 with further sales declines – while promising to turn things around in 2012.
The seasonally adjusted annual rate of sales was 13.6 million units as several manufacturers, including Chrysler, Kia, Hyundai, Subaru and Volkswagen, wrapped up 2011 with impressive gains during December. Kia, for example, posted a 42.6% increase in the final month of the year, while Chrysler sales were up 37.6% increase for December.
Notably, December saw transaction prices rise to record levels while incentives dipped for the month, following a months-long trend despite the push by some Japanese makers to try to rebuild their market share by putting plenty of cash on the hood.
Thomas J. Doll, executive vice president and COO, Subaru of America Inc. said, “We are thrilled to close 2011 with a third consecutive sales record for Subaru. 2011 was the best year in our history, but with our production levels now running at their highest ever, and our best-ever line-up in place, we are committed to another record-setting year in 2012.”
Meanwhile, Mercedes-Benz and BMW were engaged in duel for leadership in luxury car sales, which grew again in 2011.
Overall, Chrysler General Motors, Chrysler Group LLC and Ford Motor Co. all finished 2011 with double-digit increases in both sales and market share over the previous year. It was the first time that has happened since 1998.
Nissan, Hyundai, Kia, Volkswagen, Audi, Suzuki and Mitsubishi all finished 2011 with full-year sales increases.
“The year finished on a high note, with industry sales momentum strengthening as the year came to a close,” said Ken Czubay, Ford vice president, U.S. Marketing, Sales and Service. “We saw Ford sales strengthen as well, posting our best December retail sales month since 2005 and closing the year as America’s best-selling brand.”
Reid Bigland, President and CEO – Dodge Brand and Head of US Sales, noted December marked Chrysler Group’s 21st-consecutive month of year-over-year sales gains and seventh-consecutive month of sales increases of at least 20%.
“The Detroit Three dealers had nearly 50% of the inventory available for sale during December, and collectively enjoyed sales increases of more than 12% for the month,” National Auto Dealers Association Chief Economist Paul Taylor said. “The inventory advantage for manufacturers based in North America will provide sales momentum during the first quarter of 2012.”
“We are encouraged by the present market fundamentals combined with consistent signals including brisk holiday selling that indicates a broader industry recovery,” said Dave Zuchowski, Hyundai Motor America’s executive vice president of national sales. “We finished 2011 with solid momentum and much improved inventory levels and are enthusiastic about our prospects for 2012 as we continue to launch a broad array of new product entries.”
For Toyota and Honda, 2011 was a year to forget. Honda sales plunged 19% in December as it finished the year down 7%. Toyota sales also dropped 6% for the full year.
The makers pointed to a variety of issues that hammered them last year, notably the production cuts that lasted for months after the March 11 earthquake and tsunami that devastated Northeast Japan – and subsequent flooding in Thailand that further delayed a return to normal production.
Jim Lentz, Toyota Motor Sales chief operating officer, however, said during a conference call, that Toyota is poised to rebound this year. Overall, Toyota expects sales to rebound 15% in 2011 as it rebuilds inventories and launches a series of new products for its Lexus, Toyota and Scion brands.
The Camry was still the best-selling car in the U.S. for the 10th consecutive year and Corolla was the top seller in the competitive compact segment finishing ahead of both the Chevrolet Cruze and Ford Focus.
But analysts aren’t quite so confident. Rebecca Lindland, research director at IHS Automotive, cautioned that her data projects Camry sales will effectively be flat in 2012, at about 312,000 units – off about a third from its pre-recession peak and despite the launch of an all-new 2012 Camry.
Analysts are also cautious about the prospects for Honda, which not only suffered production cuts last year but a slew of bad reviews for key products including the compact Civic. Nonetheless, John Mendel, American Honda executive vice president of sales, was upbeat, telling journalists, “As we eagerly close one of the most challenging years American Honda has weathered, we are well-positioned for a strong 2012.”
A critical test for Honda will come when it launches a concept version of the next-generation Accord Coupe at the North American International Auto Show next week.
(Will Detroit regain control of the midsize market for the first time in two decades? Click Here for that story.)
While Toyota and Honda suffered sharp setbacks last year, the situation was notably different for Nissan which finished 2011 by setting a sales record. But its Infiniti brand slipped about 5% as Mercedes-Benz and BMW engaged in an all-out battle for luxury segment leadership.
“There’s a huge battle going on in the luxury segment, especially among the Germans, for the sales crown,” which meant a sharp increase in incentives, Infiniti General Manager Ben Poore said, adding “We weren’t going to follow down that path.”
While a few makers – notably Toyota, Honda, BMW and Mercedes might have ramped up incentives, most of the industry paired back, industry-wide spending slipping 3.0% in December compared to year-earlier levels, according to TrueCar.com, at an average $2,562 per vehicle.
Meanwhile, TrueCar estimated that the average transaction price for new vehicles sold in December rose to a record $30,686 last month, a 5.8% increase year-over-year.
Paul A. Eisenstein contributed to this report.