Major car makers recorded double-digit US sales gains in May from depressed year-earlier levels as industry-wide sales ticked up for a seventh consecutive month with a boost from orders by rental agencies.
The May car sales results provide one of the earliest snapshots of consumer demand for a month marked by financial market volatility and renewed questions about the strength of the US economic recovery in the second half of the year.
Ford Motor company said it posted a 22% sales gain and raised its second-quarter production target by about 2%. GM's overall sales were up 17% from sales a year earlier that came just as the top US car maker was sliding toward a US-government funded bankruptcy.
Chrysler, which was already operating in bankruptcy last May, reported a monthly sales gain of 33%. Nissan reported a 24% sales gain but said the past month was marked by a renewed sense of caution by consumers still anxiously watching the job market and housing prices.
Major car makers said they expected industry-wide sales to be around 11.4 million vehicles on an annualised and adjusted basis in May. That would be up from the 11 million vehicle sales rate that had held from January until April, and up from the 27-year low of 10.4 million vehicle sales recorded in 2009.
GM said its May results pointed toward the initial success of its turnaround plan in the year since it filed for Chapter 11 bankruptcy protection in June 2009. The company is aiming for a flotation as soon as this year to reduce the US government's ownership stake of nearly 61%. Sales of the four brands kept by the reorganised GM - Chevrolet, Cadillac, Buick and GMC - were up 32% in May.
The GM sales gain came despite any substantial increase in the kinds of costly incentives - including zero-percent financing - that GM had relied on to boost sales and support production before bankruptcy.
