Auto Sales Should Pick Up Speed

Year-end deal making and a change in reporting dates will breathe some life into U.S. car and truck sales in December, industry analysts said. “A week ago I thought sales for December would be off 3% or 4% from a year ago, but I’m seeing a lot of commercials for year-end blowouts,” said Michael Ward, an analyst at PaineWebber Inc. Ward and other analysts are now predicting that the industry’s daily sales rate for December may be flat with the year-ago period. In addition to stronger incentive programs, industry results will benefit from decisions by General Motors Corp. and Chrysler Corp. to delay their year-end sales reports until Jan. 4. That will give the No. 1 and No. 3 U.S. auto makers an extra two days for the month. Ford Motor Co., which typically reports sales on the third business day of the month, also plans to report sales Jan. 4. “It will be deceptively strong, because Chrysler and GM are going to count Jan. 2 and Jan. 3,” said auto analyst Michael Luckey, principal of the Luckey Consulting Group. Although actual sales may be flat, the seasonally adjusted annual sales rate for the month, computed with adjustment factors supplied by the Commerce Department, is expected to be about 15 million units, down from 15.6 million a year ago and 15.3 million in November. For the full year, analysts predict car and light-truck sales will reach 14.7 million to 14.8 million, down from 15.1 million in 1994. Luckey cautioned that the reporting change and special incentive programs may rob sales from January and get 1996 off to a slower-than-expected start. But for the time being, Detroit’s Big Three have big inventories to clear. As of Dec. 1, GM’s dealers had an 81-day supply of vehicles, Ford’s had a 77-day supply, and Chrysler’s had a 68-day supply. Auto makers normally consider a 60-day supply to be ideal.