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Small Cars Boost Auto Sales In April

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(credit: Justin Sullivan/Getty Images)

(credit: Justin Sullivan/Getty Images)

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LOS ANGELES (CBS/AP) — Small cars sold briskly in the U.S. last month, as gasoline prices topped $4 a gallon and some buyers worried about shortages of Japanese-made vehicles.

Analysts expected overall industry sales in the U.S. to increase 19 percent from April of last year.

Sales last month were led by highly fuel-efficient models such as Chevrolet’s Cruze, Hyundai’s Elantra and Ford’s Focus

Don Johnson, GM’s vice president of sales and marketing, said consumers shifted into smaller cars starting in March and the trend continued in April. Unlike 2008, when a rise in gas prices caught the industry off-guard, GM and other companies now have good small cars and can quickly boost production of them, he said.

“We’re probably the best prepared ever for this shift,” he said.

Gas is already over $4 per gallon on the West Coast, according to federal statistics.

While widespread vehicle shortages related to the March 11 earthquake in Japan have yet to hit the U.S. market, they’re expected to by the end of May. That may have spurred people to buy cars like the subcompact Honda Fit in April. On Monday, Honda Motor Co. warned dealers that the 2012 Civic, as well as other models, will be in short supply this summer. It also pushed back the fall launch of the CR-V small SUV by at least a month.

So far, GM says the earthquake won’t affect its profit, although it has had to slow production because of a lack of parts from Japan. Chrysler Group LLC said this week that the earthquake will cost it between 50,000 and 100,000 vehicles this year, but it won’t have an impact on earnings.

Hyundai Motor Co.’s sales jumped 40 percent, largely because of fuel-efficient models such as the Elantra, which gets an estimated 40 mpg on the highway. The car’s sales more than doubled. Combined with the Sonata midsize car, the two made up 71 percent of Hyundai’s sales.

General Motors Co. sold more than 25,000 Chevrolet Cruze compact models in April, the best performance for the 36-mile-per-gallon car since it was introduced in October. Ford said sales of its new Focus compact rose 22 percent from last year.

GM said its U.S. car and truck sales jumped 26 percent in April, led by the shift to small cars. Johnson said the Chevrolet Equinox and GMC Terrain crossovers posted big sales increases. Crossovers look like sport utility vehicles, but are more fuel efficient because they are built on car platforms.

People switched to more efficient engines, which use less gasoline.

Johnson said 39 percent of the vehicles GM sold in April had the most efficient four-cylinder engines, up from 27 percent last April. Thirty percent had six-cylinder engines, down from 36 percent. Almost half of Chevrolets sold had four-cylinder engines, Chevrolet chief Alan Batey said.

“Four-cylinder sales at Chevrolet have frankly not been as strong as this in a long, long time,” he said.

Ford Motor Co. said its U.S. sales rose 13 percent, largely because of a 26-percent jump in car sales. But it wasn’t only the most efficient cars like the Fiesta and Focus that buyers demanded. Sales of the Mustang sports car rose 59 percent car as summer driving season approached.

Ford said that the impact of gas prices could be felt in its largest vehicles. Half of all pickup buyers chose Ford’s new V-6 engine instead of the less efficient V-8.

Sales were strong despite automakers’ decision to ease up on deals in April. Total U.S. incentive spending by automakers fell $250 to $2,118 per vehicle from March, according to Edmunds.com. That was the lowest level since October 2005, when automakers pulled back sharply on discounts following the employee-discount-for-everyone deals that summer.

“This is the clearest indication yet that automakers are gearing up for inventory shortages,” Jessica Caldwell, director of industry analysis for Edmunds, said in a statement.

She said demand for new cars is growing as the economy recovers. However, buyers may decide to wait for deals to return, and that may not be until fall.

Other major automakers reporting sales Tuesday included:

– Chrysler’s sales rose 22 percent to 117,225, the company’s best April in three years. Sales were led by the Jeep brand with a 65 percent increase. The Grand Cherokee and Compass small SUV had sales that nearly tripled from last April. Chrysler also reported that sales of its revamped midsize cars, the Chrysler 200 and Dodge Avenger, rose 26 percent combined over last year.

– Toyota Motor Corp. sales rose by only 1.3 percent, led by a 9 percent gain from the Camry midsize sedan, traditionally the most popular car in the U.S. But sales of Toyota’s Corolla compact fell 13.3 percent, and two models made in Japan, the Yaris and the Prius, saw sales declines.

– Nissan Motor Co., up 12.2 percent to 71,526. The company also reported strong small car and crossover sales. The Sentra compact rose 42 percent and the Rogue small crossover climbed 28 percent. Sales of Nissan’s Titan pickup dropped nearly 30 percent. The company won a big victory earlier in the day. New York City picked Nissan to supply a small van for its taxi fleet for the next 10 years.

– Honda Motor Co. reported sales rose 9.8 percent, led by a 73 percent leap in sales of the Fit subcompact. Sales of the CR-V small crossover rose 30 percent, while sales of the compact Civic were up 7 percent.

– Subaru of America sales were up 7 percent to 24,762, led by the Outback small SUV which rose 23 percent.

– Kia Motors America’s sales surged 57 percent, led by a 41-percent increase in Sorento crossover sales.

(TM and © Copyright 2011 CBS Local Media, a division of CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2010 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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