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Gorehamj

GM Sales Report - Strong Facts & Weak Inventions

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John Goreham
Contributing Writer, GM-Trucks.com
6-1-2017

General Motors announced its May 2017 sales this week and the news overall is strong. GM is continuing to focus on profitability globally and in the Americas with positive results. One GM fact that supports this is that "...GM’s incentive spending as a percentage of average transaction prices (ATP) was 11.6 percent in May. That is equal to the industry average and lower than our 2016 calendar year average, and lower than any domestic and many Asian competitors." In other words, the huge discounts Chevy has been offering on trucks and sports cars is either settling down, or Ford and FCA US are using equally heavy discounts to move trucks. One negative effect of which is lower reported resale values since the data relies on MSPR as a starting point. Overall, GM was down about 1% for May and is down about 1% for the calendar year as well.

 

Buick is up solidly now that it has reinvented itself as a crossover company. The Chinese-built Envision is now adding a solid 4,400 units per month to the Buick Sales totals and is its second-leading seller behind the not-made-in-the-USA Encore. LaCrosse had a strong month but is still down double digits over 2016. Buick overall is up about 30% year over year. Subtract out the new model (Envision) and Buick would be about 10% behind for the year.

 

In the truck category, the Colorado flat compared to last year with a respectable 9.091 units sold. Silverado is down about 3%, Sierra down about 8%, and Canyon down 26%.

 

However, one "fact" struck us as odd, and upon checking it, we feel it is intentionally misleading. GM reported, "Cadillac XT5 — up 110 percent." While this is in a way true, the XT5 this month is up that amount compared to the XT5 from 2016, it does not mention that the XT5 was relatively new to the market at that point and the SRX it replaced was also still on sale. Combine the SRX and XT5 sales (SRX sold in this past month as well since GM can't seem to completely kill it off for some reason) and the combined sales are up about 32%. However, that is also misleading as an indicator of the model's success. The XT5 has not surpassed the SRX' sales rate yet. For example, in December of 2015 Cadillac sold 7,031 SRX crossovers, significantly more than its current sales rate. The XT5 is starting to take the place of the SRX, but we can't see any strong evidence that it is more successful in the marketplace than the Cadillac model it replaced.

 

One last footnote; GM opted to use an image of a city skyline and its logo for the sales report this month. In every past month for many years the company chose a model image as its highlight. Perhaps the message is "The individual models don't matter, it is the company that is most important..." Or maybe we are overly sensitive.

 

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That skyline photo is of GM's headquarters in Detroit, been in the area many times. That's the Detroit river and Canada in the background.

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I was near the GM headquarters in Detroit last year in the fall on a Saturday afternoon. Eerie is the best way to describe it. There were about 10 tourists walking the streets and a handful of homeless tucked away in corners. It was like a ghost town.

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On weekends that area is a ghost town. Years ago my ex lived in an apartment about two blocks away. During the week that area is crazy with people that work, weekends nobody was there. Erie is a great word for it. The river walk that GM dumped tons of money in is pretty cool though.

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