DETROIT (AdAge.com) -- Ford Motor Co. led the U.S. industry to a 13% sales gain in February while topping General Motors Co. in monthly sales for the first time in 12 years, Automotive News reports today.
Ford's sales of 142,006 light vehicles last month were 471 more than GM, which advanced 12%. The last time Ford topped GM in monthly sales was July 1998, when GM was crippled by a strike at its Delphi parts unit. GM has been No. 1 since 1931.
Ford's 43% increase marked its fifth straight monthly advance in its home market.
Total industry sales climbed by 91,381 vehicles from February 2009, which was the weakest month in the market's three-year slump. Last month's seasonally adjusted annual rate was 10.36 million vehicles, down from January's 10.54 million but well above 9.1 million a year earlier.
Toyota Motor Sales U.S.A. fared better than analysts had projected, dropping 9% in the midst of its recall crisis.
Better than expected
Chrysler Group, the only other major automaker projected to post a decline, rose less than a percent. Subaru, up 38%, and Nissan North America, up 29%, had the strongest advances behind Ford.
"Sales in both January and February were much better than they could have been, given weather-related issues, Toyota recalls and seasonally weak demand," said KeyBanc Capital Markets analyst Brett Hoselton. "We continue to expect the overall trend in sales to move gradually higher throughout 2010 and into 2011."
While GM's overall February sales rose, demand is still about half of the automaker's pre-recession levels. A combined 33% advance at Buick, Cadillac, Chevrolet and GMC more than made up for an 86% drop at the automaker's four canceled brands: Hummer, Pontiac, Saab and Saturn.
GM said it would offer a range of zero-percent financing offers on 2009 and 2010 vehicles. It also announced an executive shake-up that centers responsibility for delivering a promised sales turnaround on North American President Mark Reuss. Mr. Reuss, Automotive News reported on Sunday, has been given responsibility for sales, while VP Susan Docherty, 47, who had been in charge of North American sales and marketing, will run U.S. marketing only. She reports to Mr. Reuss, 46.
As part of that GM reorganization, brand general manager positions no longer exist. Mr. Reuss said he initiated the changes to flatten GM's North American organization, which he said was not moving fast enough to increase sales. Making GM North America "a focused standalone business unit" is critical to the overall health of the company.
The move reverses changes made in December after the departure of CEO Fritz Henderson. At that time, Ms. Docherty was promoted to VP-sales, marketing, service and OnStar. She was previously in charge of sales.
In the conference call with reporters this week, Ms. Docherty said that marketing will be streamlined. In the past, she said, "there were a lot of people in the company that were touching the function of marketing."
Under the reorganization reported by Auto News, senior brand marketing executives will report to Ms. Docherty. They are:
In the sales organization, sales leaders for the brands report directly to Reuss. They are:
Mr. Nesbitt is leaving his post as Cadillac brand chief, which he took in August, and returning to the design organization as executive director, advanced concept group. He reports to Ed Welburn, VP-global design.
Jack Nerad, an analyst at Kelley Blue Book, said GM's results showed the automaker was still struggling from a "post-bankruptcy syndrome."
"A percentage of the American buying public has been turned off by GM's bailout," he said in a note. "The fact that Ford is a major beneficiary of Toyota's safety recalls is another factor in this complex mix."
Toyota's uncharacteristic decline was led by a drop of nearly 20% for its top-selling Camry sedan, prompting the company to offer sharply expanded incentives for March. For the second straight month, Toyota Division declined while Lexus gained.
Ford's U.S. sales were powered by gains for the Fusion, a Camry competitor that saw sales more than double from a year earlier. Ford sales chief Ken Czubay said the Fusion was winning new customers for Ford in six out of 10 cases, calling the mid-sized sedan "the poster child" for the automaker's strategy of taking business without being pulled into a price war.
Toyota's major competitors gained ground. In addition to Nissan's gain, American Honda reported a 13% sales increase. Hyundai saw sales increase 11%.
Barclays Capital analyst Brian Johnson said Toyota's discounting raised the pressure on its rivals to offer their own competitive discounting. "These expensive programs should represent a material step up in cost of incentives," Mr. Johnson said in a note for clients. He estimated that it would cost Toyota almost $4,700 per vehicle to offer 0% financing for five years, an effective discount that almost triples what the automaker had been spending on incentives.
Ford vowed not to be drawn into a price war, although executives said that the still-unsteady pace of economic recovery made pricing a more important factor for consumers. "The battlefield is strewn with a lot of competitors who have fallen to over-merchandising," Mr. Czubay said. "We will continue to let our products do the talking"
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Charles Child and Dave Guilford are reporters at Automotive News