Yahoo Finanza General Motors Posts Lower 2nd-Quarter US Sales
Automaker General Motors Co. (NYSE:GM) released its second-quarter sales report on July 1. Quarterly sales slipped due to the impact of the coronavirus pandemic.
Performance at a glance
The Detroit-based automaker delivered 492,489 vehicles in the second quarter, down 34% year over year.
Company's retail sales, however, showed signs of recovery. While retail sales plunged 35% in April, it "recovered significantly in May and June with year-over-year declines of around (20%) or less."
In a statement, Kurt McNeil, U.S. vice president of sales operations, said:
"GM entered the quarter with very lean inventories and our dealers did a great job meeting customer demand, especially for pickups. Now, we are refilling the pipeline by quickly and safely returning production to pre-pandemic levels. Having an appropriate mix of the right vehicles combined with the benefits of enhanced shopping technologies such as Shop. Click. Drive., positions us for success in the second half of 2020."
How did the brands fare?
Cadillac witnessed a sales decline of more than 41.4% to 23,296 vehicles. Sales of the division's top-selling XT5 sport utility were disappointing at 5,783 units, down roughly 56% on a year-over-year basis. XTS sales also dipped 95% to 264 units.
The Chevrolet brand saw sales fall 33.6% to 331,917 units. The company attributed the overall decline to a 14.06% drop in sales of Silverado Pickups to 122,432 units. Equinox sales dipped 40.7% to 50,798 units. On the bright side, Chevrolet Trax sales inched up 3.1% to 22,466 units. However, it did not have a favorable impact on the division's overall quarterly growth.
GMC sales totalled 101,756 units, down 33%. A 46.4% decline in sales of Acadia (15,242 units sold) and a 68.6% decline in sales of Savana (2,984 units sold) let the automaker down. Additionally, the brand saw sales decreases of all the other models.
Buick's sales plunged 36% to 35,520 units. Encore, the brand's top-selling vehicle, recorded a sales decline of 58.7% to 10,033 units. Sales decreased roughly 97% for LaCrosse and 72.46% for Regal.
Company heads towards recovery
GM's sales turned around after poor start to the second quarter on account of the Covid-19 pandemic. Company Chief Economist Elaine Buckberg had the following to say:
"After falling into a deep recession in March, the U.S. economy has begun to recover as it reopens. Auto sales are benefiting from historically low interest rates that make now an attractive time to buy a vehicle for many customers. We expect continued sales recovery as businesses ramp back up, but recognize that the path forward may not be linear, as rising infections in many states may lead to steps backward in the reopening process."
The company said that almost all of its U.S. plants, including the truck and SUV plants, would stay operational during the traditional summer holiday spanning for two weeks. In addition, the company said that the incremental output would be devoted towards refurbishing retail channels "with capacity made available by lower rental volumes."
Disclosure: I do not hold any positions in the stocks mentioned.
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This article first appeared on GuruFocus.
