Sales numbers for March are in, and many automakers sold more cars than they did this time last year.
Overall, sales rose “24 percent from the depressed levels of March 2009, when automakers were battling the weakest demand in almost three decades,” reports Auto Week. “The seasonally adjusted annual sales rate of 11.7 million was the year's highest and the second strongest since August, when the U.S. cash-for-clunkers campaign lifted demand.”
The big winners for March 2010 are Toyota and Ford, with GM close behind. Toyota’s aggressive incentive campaign helped it post gains of nearly 41 percent over last year -- which is especially impressive considering it posted a 10 percent decrease in February due to its very public unintended acceleration recalls.
Ford also posted a 40 percent increase over last year. GM posted a 21 percent increase, while Honda’s sales rose 23 percent as compared to March 2009.
“The sales point to one conclusion: March was a good time to buy a new car,” concludes the Associated Press. “Automakers ramped up promotions, with incentive spending up $100, or 4 percent, from February to $2,742 per vehicle, according to Edmunds.com. That's still down from a record high of $3,165 last March, when dealers scrambled to lure customers worried about rising layoffs and bankruptcies at GM and Chrysler.”
In fact, March was a good month for nearly every automaker – with the major exception being Chrysler, which posted a decrease of 8 percent.
The Detroit Free Press notes that Chrysler reported “its first year-over-year increase in more than two years in February. The weakness [in March] was because of softness in the Dodge brand, where small and midsize sedans, crossovers and even the Caravan minivan failed to match year-ago levels.”
So what do the sales gains (minus Chrysler) mean for the industry and for customers? The Associated Press quotes Edmunds.com Analyst Jessica Caldwell as saying the sales increases “shouldn't be viewed as a sign of economic recovery because automakers had to shell out a lot of money to draw in customers.”
On top of that, Forbes points out that that last month’s discounts and incentives won’t stick around for long. In fact, they say, “Vehicle prices have been increasing in recent months after several years of stagnation. The big reason is that carmakers are doing a better job of aligning their production with lower consumer demand. With leaner inventories, they've been able to use more restraint when it comes to profit-sapping incentives (that is, until the Toyota crisis popped up).”
The lesson for car buyers is clear: The industry is slowly on the rise – and it’s adapted to a poor economy – so great deals may not be around next year. If you want to buy a new car, 2010 might be your last chance to take advantage of this buyer’s market. To learn about the best times to buy a car this year, see our feature article.