GM, Ford June Sales Trail Estimates

GM, Ford June Sales Trail Estimates as Consumers Shun Purchases

By David Welch and Jeff Green

July 1 (Bloomberg) -- General Motors Co. and Ford Motor Co., the two largest U.S. automakers, reported June sales that fell short of analysts’ estimates as consumers concerned about unemployment and the economy avoided large purchases.

GM’s U.S. sales gained 11 percent, trailing the 16 percent average estimate of six analysts surveyed by Bloomberg. Ford’s deliveries rose 13 percent, less than the six analysts’ 16 percent average projection.

The results show the auto market may be slowing as waning consumer confidence keeps buyers out of showrooms. Industrywide deliveries in June were expected to reach an annualized rate of 11.2 million vehicles, according to the survey. That would be a drop from 11.6 million in May and a gain from last year’s depressed 9.7 million-unit pace.

“Car sales are in line with the consumer confidence numbers that came out, which were a huge disappointment,” said John Wolkonowicz, an analyst with IHS Automotive, a research firm in Lexington, Massachusetts. “Traditionally, June is a good selling month. But there are other overriding circumstances this June that are causing some disappointment.”

The Conference Board said earlier this week that its confidence index slumped to 52.9 this month from a revised 62.7 in May. The private research group’s June figure was less than the lowest forecast of economists surveyed by Bloomberg News.

Annual auto deliveries averaged 16.8 million from 2000 through 2007 and fell to 10.4 million last year, the lowest in 27 years.

Chrysler Group LLC said sales gained 35 percent from a year earlier, topping six analysts’ average estimate for a 33 percent increase.

‘Flat-Lined’

U.S. auto sales have “flat-lined” since last year’s third quarter as consumers have been unwilling to make big purchases, Mark Fields, Dearborn, Michigan-based Ford’s president of the Americas, said last week.

“Recent economic news continues to point to a slow recovery,” Steve Carlisle, Detroit-based GM’s vice president of global product planning, said today on a conference call. He said GM is maintaining its forecast for the industry to sell 11.5 million to 12 million vehicles this year.