Chrysler May sales are the strongest in 5 years
(MoneyWatch) Chrysler Group today reported its best May sales since 2007, with a 30 percent gain over a year earlier. This continued the strong recovery by the automaker, which was bailed out by the federal government in 2009 after declaring bankruptcy, with the company's sales rising by at least 20 percent for 12 straight months.
Chrysler brands sold a combined 150,041 vehicles, with Chrysler, Jeep, Dodge, Ram, and Fiat all showing gains. The Jeep Wrangler led the way with a 44 percent jump over a year ago, its top month ever for sales. But a broad range of models showed double-digit gains, including the Ram pickup, Chrysler 300 sedan, and Chrysler Town and Country and Dodge Grand Caravan minivans.
"In spite of a tremendous amount of global economic uncertainty, the U.S. new vehicle sales industry continues to power ahead, " said Reid Bigland, president and CEO of the Dodge brand and head of Chrysler Group U.S. sales, in a statement. When all May results are announced, Chrysler will wind up with an 11.8 percent share of the market, according to projections by automotive web site Edmunds.com.
Analysts forecasting overall May sales believe overall U.S. auto sales could be up as much as 30 percent over a year ago. Based on the expected May results, forecaster LMC Automotive has raised its sales prediction for all of 2012 to 14.5 million, compared with 12.8 million in 2011. LMC analyst Jeff Schuster raised that target based on sales trends and on what he called "stability in economic fundamentals required to sustain a higher selling rate throughout the remainder of the year."
One reason for the big jump this year is the plunging sales that followed the May 2011 earthquake and tsunami in Japan. Toyota (TM) and Honda (HMC), which were hit especially hard, had to close down production of cars made in Japan. The resulting inventory shortages hurt sales. In fact, Kelley Blue Book is projecting that Toyota's May sales could nearly double over a year ago.
Another factor boosting sales could be increased rebates and other incentives to entice buyers. Ford (F) and Nissan both increased their incentives by more than 9 percent over April, according to Edmunds.com. And Honda incentives were up 23 percent, and Toyota's 16 percent over May 2011.
Edmunds projected that General Motors (GM) would keep its sales lead, with a 17.7 percent share of the May market, though that is down from 20.8 percent a year ago. Ford is forecast to remain second, with a 16 percent share, and Toyota third with 14.8 percent.
