June is Bustin’ Out All Over for GM

24 June 2002

The June sun is shining on General Motors, the globe’s largest auto manufacturer. Although the car colossus’ lips are zipped as to actual sales numbers for this month, group vp, North America Vehicle Sales, Service and Marketing Bill Lovejoy is sporting a broad grin.

“We feel much better about June than we did May,” said Lovejoy in an interview last week. “May [which saw a 12% year-on-year sales decline] was very disappointing.”

US car sales across the board slipped by 6% in May following four unexpectedly buoyant months. The fall prompted a number of analysts [who presumably have never heard of short term fluctuations in trends] to retune their crystal balls and predict a general slowdown in sales.

Lovejoy, however, sees no evidence in the June figures that the entrail-rakers are right: “They will be disappointed,” he said. He lays blame for May’s downturn on the ending on April 30 of a number of incentive programs [as pointed out by WAMN, 05-Jun-02].

Although these particular GM-led incentive promos have reached their natural end, Lovejoy vowed to match rivals’ discount offers. “We’re not going to blink. We will gain share this year and we will gain share next year,” he prophesied – albeit reluctant to attach numbers to his divinations.

• Elsewhere in the GM empire, luxury marque Cadillac is bullish about prospects for the remainder of 2002. It expects new models like the CTS Sedan and the Escalade SUV, launched last year, to drive gains of between 5%-10% as sales of older models run out of gas.

But Caddy, still top dog among stateside luxury brands, is steadily being overtaken by imported rivals, recording a 9% fall in sales to 172,083 units in 2001. The GM flagship isn’t taking this lying down, rolling out a series of new Cadillacs flaunting an aggressive, modern styling approach that it hopes will distinguish it from the many contenders for its crown.

Sales at 69,934 units are up 12.5% in the first five months of this year, although it warns that comparative performance year-on-year will become tougher in the fourth quarter, given last year’s aggressive discounting during the period.

Data sourced from: The Wall Street Journal Online; additional content by WARC staff