Auto on Info  October 2004

In the U.S. in September 2004, Toyota and Nissan Sales Soar; General Motors' and Ford's Fire Sales Able to Attract U.S. Buyers

Nissan, with a 1995-1999 Reliability Percentrank average of .74, increased its U.S. auto sales by 11% in September 2004, over those of September 2003. Nissan's U.S. sales for the first nine months of 2004 are up 22%.

Toyota, with a 1995-1999 Reliability Percentrank average of .90, saw its U.S. auto sales rise by 10% in September 2004. Toyota's U.S. sales for the first nine months of 2004 are up 9%.

For September 2004, Toyota again published very detailed information on vehicle sales. The following table provides this detailed information, but separates out the Scion division from the Toyota division, together with 1995-1999 model Reliability Percentrank averages. Those models that were among July 2004's Hottest Ten, for all manufacturers, are in bold blue. That model that received CAA's most recent Pyramid Award for ownership satisfaction is italicized.

Table I: September 2004 Toyota Sales, Percentage Changes, and 1995-1999 Reliability Percentrank Averages, by Line, Type, and Model
Manufacturer	Division	Type of Vehicle	Model	Sales Volume	Percentage Increase for September 2004 from September 2003	1995-1999 Reliability Percentrank Average
Toyota Motor Corporation				161,793	10.3%	.90
	Scion Division			10,376	510.7%	N/A
			xA	2,183	217.0%	N/A
			xB	3,952	291.1%	N/A
			tC	4,241	N/A	N/A
	Toyota Division			131,230	4.8%	.88
		Passenger Car		68,362	1.9%	N/A
			Camry	34,628	-0.2%	.86
			Corolla	26,246	3.6%	.93
			Prius*	4,309	3,593.4%	N/A
		Light Truck		62,868	8.2%	N/A
			Sienna (minivan)	11,697	145.3%	.731
			Highlander (SUV)	10,150	-3.0%	N/A
			4Runner (SUV)	9,348	14.9%	.92
			Land Cruiser (SUV)	614	17.7%	.731
			Tundra (pickup truck)	8,973	5.5%	N/A
			Tacoma (pickup truck)	12,040	-11.3%	.93
	Lexus Division			20,187	2.3%	.94
		Passenger Car		9,309	-5.6%	N/A
			ES330	4,926	-7.8%	.962
			LS430*	2,448	35.1%	.972
			SC 430 (hardtop convertible)	699	-9.3%	N/A
		Light Truck		10,878	10.2%	N/A
			RX 330* (SUV)	7,525	6.9%	.851,2
			GX 470 (SUV)	2,585	27.7%	N/A
			LX 470	768	-4.5%	N/A
1Based on data for 2 or fewer model years
2Includes data for preceding model number
Bold blue script indicates that the model was in July 2004's Hottest Ten, for all models of all manufacturers.
Italicized script indicates that the model received CAA's most recent Pyramid Award for ownership satisfaction.
Underscored script indicates that the model is a recent Consumer Reports Quick Pick.
A gold asterisk (*)indicates that the model is a CR 2004 Top Pick.

The Toyota Motor Corporation models showing the largest sales gains in September 2004 over September 2003 are the Toyota Prius, up 3,593.4%, the Scion xB, up 291.1%, the Scion xA, up 217.0%, the Toyota Sienna, up 145.3%, the Lexus LS 430, up 35.1%, the Lexus GX 470, up 27.7%, and the Toyota Land Cruiser, up 17.7%. Although the Land Cruiser had a good month, sales of the Lexus LX 470 for the first nine months of 2004 exceed those of the Toyota Land Cruiser, a more Spartan cousin, by 35.6%.

Toyota's Scion line, up 510.7%, is a new line. It is intended to meet the tastes and needs of young adults; however, it has, as well, proven popular with Baby Boomers - older folks who are generally young at heart.

The Toyota Prius, up 3,593.4%, is Toyota's gas-electric hybrid. The extraordinary popularity of the 2004 edition is likely a consequence of a combination of factors. First, the 2004 Prius is a midsize sedan. Second, it employs new gas-electric power-train technology that delivers more power and performs greater work per unit of energy source. This gives it an acceleration comparable to that of the Camry midsize sedan and increases its estimated EPA rating for in-city driving from 55 miles per gallon to 60 miles per gallon.¹ In short, the 2004 edition of the Prius is a bigger car with better gas mileage than its previous editions. Third, it is both a Consumer Reports Quick Pick and a CR Top Pick with a predicted reliability in the highest category.

To meet the surging demand for the Prius, Toyota announced that it plans to increase production by 50% from August 2004 to July 2005.¹

Mazda, with a 1995-1999 Reliability Percentrank average of .72, saw its September 2004 U.S. auto sales fall 11%. Mazda's U.S. sales for the first nine months of 2004 are up 4%.

Honda, with a 1995-1999 Reliability Percentrank average of .86, saw its September 2004 U.S. auto sales fall 2%. Honda's U.S. sales for the first nine months of 2004 are nearly unchanged. Subaru's September 2004 sales rose 13% and year-to-date sales have fallen 5%.

In summary, the September 2004 sales by the auto manufacturers of quality products were mixed - Nissan, Toyota, and Subaru up quite a bit and Honda and Mazda down some; however, overall, the sales by auto manufacturers of quality products in the first nine months of 2004 have been very good; for Toyota (+9%) and Nissan (+23%), excellent.

At the other end of the quality spectrum, the 3-day fire sale - September 28th - 30th - by General Motors (95-99 RPA of .30) very successfully dragged in U.S. buyers. GM's September 2004 sales were up 21% over those of September 2003. The fire sale gave GM positive sales growth for the year, up 1%, and brought its year-to-date market share back up to .28. However, fire sales with generous credit terms are thought to bring mixed consequences, as they cause more consumers to view the manufacturer's products as cheaply or poorly made and they tend to draw in the depths of humanity.

Chrysler (95-99 RPA of .31) saw its September 2004 U.S. auto sales rise 10%. Chrysler's U.S. sales for the first nine months of 2004 are up 3%.

Ford (95-99 RPA of .51) saw its September 2004 U.S. auto sales fall 7%. Ford's U.S. sales for the first nine months of 2004 are down 5%.

All three of the Big Three had lower U.S. car sales in the first nine months of 2004. The decrease in car sales suggests that the conceptual equation "Big Three cars = poor quality" may be well planted in the U.S. and is beginning to enter the second quartile of the U.S. population, although the bottom quartile is likely nearly untouched.

The U.S. market shares, historical and year-to-date, together with natural market share estimates, are given in the table below.

In the Hyundai vs. General Motors war, Hyundai is winning, with vehicle sales up 3% for the first nine months.

Sales by Saab, a European subsidiary of General Motors with a 1995-1999 Reliability Percentrank average of .50, are down 23% for the first nine months of this year, but sales by Volvo, a European subsidiary of Ford with a 1995-1999 Reliability Percentrank average of .35, are up 2% for the first nine months. In the late 1980s and early 1990s, Volvo had high Reliability Percentrank averages; from these it may still be benefiting.

In the niche markets, Porsche September sales fell 5%, BMW sales rose 26%, and Mercedes-Benz sales fell 3%. The rotation out of Mercedes' U.S. made M-Class SUV, with its abysmal 1998-2000 Reliability Percentranks of .03, .15, and .02, slowed some from earlier months; sales fell 7%.

Note: Big Three sales and market shares do not include sales of European lines - Mercedes-Benz, Saab, Volvo, Jaguar, and Land Rover. September

Source for September 2004 auto manufacturer sales data: Wall Street Journal, October 4, 2004, page B6, "Automobile Sales Statistics." As now seems usual, the September 2004 daily selling rate percentage changes given in the Journal were not corrected for the increased number of selling days in September 2004, despite a statement to the contrary. The correct percentage changes may be found in "September U.S. Auto Sales Figures," at http://www.detnews.com/2004/autosinsider/0410/02/autos-291173.htm

Source for detailed Toyota sales data: "Toyota Announces Best-Ever Third Quarter and September Sales," October 1, 2004, at http://pressroom.toyota.com/photo_library/display_release.html?id=20041001

Source for Reliability Percentranks and Percentrank averages: AOI's Table I-MVRP

Source for July 2004's Hottest Ten: "Hot Off the Lot," Wall Street Journal, August 11, 2004, p. D4

Sources for Consumer Reports Quick Picks: Consumer Reports, February 2004, p. 49 and Consumer Reports, May 2004, p. 53, Consumer Reports, August 2004, p. 51

Source for CR Top Picks: Consumer Reports, April 2004, p. 9

¹ "Toyota Announces 50-Percent Boost in 2005 Prius Hybrid Production To Meet Unprecedented Demand," at http://pressroom.toyota.com/photo_library/display_print.html?id=20040803b