Ford Surpasses GM in February Sales

In this Feb. 28, 2010 photo, 2010 Ford Escapes sit at a Ford dealership in Littleton, Colo. Ford Motor Co. said Tuesday, March 2, 2010, its U.S. sales jumped 43 percent in February thanks to strong demand for its cars. (AP Photo/David Zalubowski) AP Photo/David Zalubowski

Ford posted a 43 percent jump in February U.S. auto sales and outsold General Motors for the first time in nearly a dozen years as it grabbed sales from struggling Toyota.

Ford Motor Co.'s sales surged thanks to strong demand for its cars and because it was able to grab some customers from Toyota Motor Corp., whose sales fell 9 percent due to a massive safety recall. Ford sold 334 more cars than GM in the U.S. for the first time since August 1998, when GM was in the midst of a strike.

Besides Ford and GM, other winners included Kia Motors Corp. and Honda Motor Co. Even struggling Chrysler saw improvement.

February was the first full month since Toyota's Jan. 26 decision to halt sales of eight popular models in the U.S. because of safety concerns. Those cars went on sale again as dealers repaired them, but Toyota's image suffered from the recall of millions of vehicles and congressional hearings on its safety record. Analysts had expected Toyota to see a double-digit drop in sales for the month. The Japanese automaker jacked up incentive spending to lure buyers.

General Motors Co. reported an 11.5 percent increase, helped by new models and Toyota's woes.

Susan Docherty, GM's vice president of sales and marketing, said GM won over some Toyota buyers who left the Japanese carmaker due to the recalls. Chevrolet car sales to individuals rose 10 percent in February, an indication that GM it taking some of Toyota's core market, she said.

"We feel we're getting our fair share of the Toyota business," she said.

More on Toyota's troubles:

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NYT: Troubles Predate Recalled Toyotas
Poll: 49% Say Toyota Hiding Something
More Toyotas Need Oil Hose Fix
Toyota New Car Sales Up Amid Recalls
Toyota Seized after "Near Death" Claim
Toyota Accused of Hiding Design Evidence
Toyota Woes Highlight Hi-Tech Car Pitfalls
Auto Industry Insider on Electronics Challenges

Mike DiGiovanni, GM's top sales analyst, said he expected that trend to continue into the spring.

Most carmakers offered deals to Toyota customers for trading in their vehicles. According to Edmunds, incentive spending rose 11 percent from January to $2,588 per vehicle. Toyota's incentive spending rose 26 percent, to $1,833 per vehicle.

GM's sales of its Buick, Chevrolet, Cadillac and GMC brands climbed 32 percent. GM plans to keep those four brands and is phasing out Pontiac, Saturn and Hummer. It has sold Saab.

The industry was expecting to see gains over February 2009, which was one of the weakest months in a very depressed year. Sales over President's Day weekend - which traditionally kicks off the spring selling season - were robust, according to the auto information site Edmunds.com.

Still, winter storms at the beginning and end of the month hurt sales on the East Coast and in the Midwest. GM said its sales dropped 22 percent in the Northeast region. The corridor from Boston to Washington typically accounts for about a quarter of the automaker's U.S. sales.

"Three and a half feet of snow on these cars. It took our dealers a bit of time to get all that snow off here and get the customers back into the showrooms," Docherty said.

DiGiovanni said sales probably would have been 5 percent higher had it not been for snowstorms. That means the gradual economic recovery is continuing despite setbacks in home sales, new home construction and unemployment, he said. Consumer confidence - which is measured by how much buyers spend - took an unexpected dive in February, indicating people are nervous about the economy.

Much of GM's sales increase was due to demand for large new wagons such as the Chevrolet Equinox, which jumped 133 percent, and the Cadillac SRX, which saw sales more than quadruple. Those two models are the size of SUVs but are built on a car frame for better fuel economy.

Sales to rental car companies and other fleet buyers also were strong as companies began buying again after cutbacks last year. Fleet sales generally mean lower profits to automakers than retail sales to individuals.

Retail sales for GM's four core brands edged up 7 percent.

Ford had expected sales to climb from last February, when U.S. sales plummeted in the midst of the recession. Its car sales climbed 54 percent as consumers continued to shop for more fuel-efficient vehicles. Like GM, Ford saw renewed demand from corporate fleet customers, which are buying again after weak sales in 2009. Ford's fleet sales surged 74 percent over February of last year, while GM's jumped 114 percent.

South Korea's Kia Motors Corp. saw U.S. sales rise 9 percent on brisk demand for its Sorento and Soul, a boxy vehicle aimed at city dwellers. Japan's Honda said sales rose 13 percent, lifted by its top-selling Accord sedan. Subaru reported a 38 percent jump.

Chrysler will report its first year-over-year monthly increase since December of 2007 when it releases numbers later Tuesday, according to a person briefed on the figures. The increase will only be a few hundred vehicles, but the person said it's a sign that the company is starting to recover in the U.S. market. The person did not want to be identified because sales figures have not been released.

Surging sales of large wagons helped Japan's Subaru, which said its February sales in the U.S. jumped 38 percent led by the Outback and Legacy sedan. Both vehicles got a redesign for the 2010 model year. Sales of its Forester SUV were up 6 percent.
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