Auto on Info  June 2005

In the U.S. in May 2005, Sales Shift Toward Quality Continues

By James B. Bleeker

Toyota Motor Corporation, with a 1996-2000 Reliability Percentrank average of .90, saw its U.S. auto sales rise by 8% in May 2005, over those of May 2004. Its U.S. car sales rose 14% and its U.S. truck - SUV, minivan, and pickup - sales rose 1%.

The following table provides detailed information regarding Toyota Motor Corporation's U.S. sales in the month of May 2005, together with 1996-2000 model, line, and manufacturer Reliability Percentrank averages. Those models that were among July 2004's Hottest Ten, per WSJ's lot-stay time, for all manufacturers, are in bold blue. That model that received CAA's most recent Pyramid Award for ownership satisfaction is italicized.

The Toyota Motor Corporation models showing the largest sales gains in May 2005 over May 2004 were the Lexus GS 430 sedan, up 367.0% to 638, the Lexus GS 300 sedan, up 304.1% to 2,503, the Toyota Avalon large sedan, up 166.8% to 9,165, the Toyota Prius gas-electric hatchback, up 158.7% to 9,461, the Scion xB wagon, up 32.3% to 4,592, the Lexus RX 330 sport utility vehicle, up 20.1% to 10,707, and the Toyota Tundra pickup truck, up 18.4% to 10,557.

Toyota's Hottest Sellers in May 2005
2005 Lexus GS 430	2005 Lexus GS 300	2005 Toyota Avalon
2005 Toyota Prius	2005 Scion xB	2005 Lexus RX 330
2005 Toyota Tundra
The above links are to onsite review pages.

Toyota's Scion line, up 132.2% for the month, 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 158.7% for the month, is Toyota's gas-electric hybrid. The extraordinary popularity of the 2005 edition is likely a consequence of a combination of factors. First, the 2005 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 2005 edition of the Prius is a bigger car with better gas mileage than its pre-2004 editions. Third, it is a Consumer Reports 2004 Quick Pick, a CR 2004 Top Pick, a CR 2005 reliability Quick Pick, a CR 2005 owner satisfaction Quick Pick, a CR 2005 fuel efficiency Quick Pick, and a CR 2005 Top Pick. Nonetheless, the Prius has a stalling glitch. (See "Prius Has Stalling Glitch, NHTSA Commences Investigation," Auto on Info, June 2005.) It will likely be incumbent upon Toyota to resolve it, for sales momentum to be maintained.

U.S. sales of the Lexus LX 470 through May 2005 exceeded those of the Toyota Land Cruiser, a more Spartan cousin, by 45.0%.

Honda Motor Company, with a 1996-2000 RPA of .86, saw its May 2005 U.S. auto sales fall 8%. Honda Motor Company's models showing the largest sales gains in May 2005 over May 2004 were the Acura RL sedan (1996-2000 RPA of .90 and with a CR 2005 predicted short-term reliability in the second highest category), up 225.7% to 1,404, the Honda Pilot sport utility vehicle (too recent to have a 1996-2000 RPA, but with a CR 2005 predicted short-term reliability in the second highest category and a CR 2005 owner satisfaction Quick Pick and a CR 2004 and 2005 Top Pick, and with the Pilot EX-L edition a CR 2005 overall Quick Pick), up 17.9% to 10,107, the Honda Odyssey minivan (1996-2000 RPA of .87 and with a CR 2005 predicted short-term reliability in the second highest category, also a CR 2005 Top Pick and an IIHS 2005 Best Pick Frontal), up 6.6% to 16,412, and the Acura TL (a CR 2005 owner satisfaction Quick Pick), up 6.1% to 7,032. Through May 2005, the Honda Odyssey minivan outsold the Toyota Sienna by 9,141 vehicles, or 14.6%, and the Honda CR-V sport utility vehicle outsold the Toyota RAV4  by 31,307 vehicles, or 106.3%.

Honda's Hottest Sellers in May 2005
2005 Acura RL	2005 Honda Pilot	2005 Honda Odyssey
2005 Acura TL
The above links are to onsite review pages.

Nissan Motor Company, with a 1996-2000 Reliability Percentrank average of .74, increased its U.S. auto sales by 16% in May 2005. Its U.S. car sales rose 16% and its U.S. truck sales rose 15%. Nissan Motor Company's models showing the largest gains in U.S. sales in May 2005 over May 2004 were the Infiniti M45 sedan (too recent for a 1996-2000 RPA or a CR 2005 predicted short-term reliability), up 1,228.2% to 2,170, the Nissan Pathfinder sport utility vehicle(1996-2000 RPA of .84), up 191.9% to 6,071, the Nissan Murano sport utility vehicle (too recent for a 1996-2000 RPA, but with a CR 2005 predicted short-term reliability in the second highest category and with the Murano SL edition a CR 2005 overall Quick Pick), up 34.0% to 6,188, the Nissan Sentra sedan (1996-2000 RPA of .63 and with a CR 2005 predicted short-term reliability in the second lowest category), up 28.9% to 11,876, the Nissan Altima sedan (1996-2000 RPA of .78 and with a CR 2005 predicted short-term reliability in the middle category, also with the 3.5 SE V6 edition a CR 2005 safety Quick Pick), up 25.9% to 23,900, the Nissan Armada sport utility vehicle (too recent for a 1996-2000 RPA, but with a CR 2005 predicted short-term reliability in the lowest category), up 24.5% to 3,534, the Nissan Titan pickup truck (too recent for a 1996-2000 RPA, but with a CR 2005 predicted short-term reliability in the middle category and a CR 2005 owner satisfaction Quick Pick), up 11.4% to 7,441, and the Infiniti FX sport utility vehicle  (no 1996-2000 RPA, but the FX35 is a CR 2005 overall Quick Pick), up 6.8% to 2,365. Nissan's reliability scourge, the Nissan Quest minivan (1996-2000 RPA of .39), had its U.S. sales rise 3.1% in May 2005.

Nissan's Hottest Sellers in May 2005
2005 Infiniti M45	2005 Nissan Pathfinder	2005 Nissan Murano
No photo available
2005 Nissan Sentra	2005 Nissan Altima	2005 Nissan Armada
2005 Nissan Titan	2005 Infiniti FX

Subaru, with a 1996-2000 RPA of .82, saw its May 2005 U.S. auto sales rise 10%. Its car sales rose 25% and its truck sales fell 16%. Subaru's media site failed to provide a sales breakdown for the month of May, as of June 2nd.

Mazda, with a 1996-2000 RPA of .72, saw its May 2005 U.S. auto sales rise 5%. Its car sales rose 23%, but its truck sales fell 33%. May sales of the Mazda3 rose 36.3% to 12,086 and those of the Mazda6 rose 18.2% to 7,458.

In summary, the May 2005 sales by the auto manufacturers of quality products were solid; sales by Toyota, Subaru, and Nissan rose 8%, 10%, and 16%, respectively.

At the other end of the quality spectrum, May 2005 U.S. auto sales by General Motors, with a 1996-2000 RPA of .29, fell 5%. Sales fell in most of its lines - Oldsmobile (1996-2000 RPA of .26) down 80%,  Pontiac (1996-2000 RPA of .23) down 26%, Saturn (1996-2000 RPA of .35) down 17%, Buick (1996-2000 RPA of .49) down 14%, GMC (1996-2000 RPA of .27), down 3%, and  Chevrolet (1996-2000 RPA of .13) down 0.2%. Year-to-date, only one line has shown a sales increase - the Cadillac line, up 4%.

Site Manager's Assessment on GM Prospects:

General Motors Corporation has gotten itself into a short-term pickle. It cannot close factories, as laid off workers collect the bulk of their wages, per GM's contract with the United Auto Workers that runs to 2007. It must continue to design its vehicles so that its customers will want to get rid of them within 3 or 4 years time, lest sales of new vehicles drop deeper. It cannot improve durability and post-3rd-year reliability, lest 2nd hand purchasers retain their vehicles longer, resale values after 3 years fall deeper, and as a consequence new vehicle sales suffer. However, its long-term existence seems not threatened, as one strategic Chapter 11 bankruptcy should solve most of its problems.

Furthermore, perspective should be maintained. For more than a decade, Big Three consumers have rotated among North America's historically dominant auto manufacturers in their steadfast quest for a better vehicle, with only minor "leakage" to the quality products of the Top Four - Toyota, Honda, Subaru, and Nissan - at the time of each major rotation. As year-to-date and May sales of all Big Three products have fallen only 2%, the historical pattern appears to be holding.

Presently, the rotation favors the Chrysler Group of Daimler Chrysler AG. Its year-to-date and May sales have increased 6%, as GM's year-to-date and May sales have fallen 5%.

However, over the next two years, GM will be offering newly designed pickups and SUVs. This should help it to redirect the rotation (but with further leakage) in GM's favor.

Nonetheless, it is unclear as to how much newly designed pickups and SUVs will bump up GM sales. Complicating factors include:

1. General Motors' less-than-high-tech pickup problems and its reluctance to issue safety recalls on them. (See "After 13,000 Consumer Complaints and Warranty Claims and 83 Reported Injuries, NHTSA Ratchets Up Investigation into Collapsing Tailgates of Another 3.1 Million GM Pickups," Auto on Info, April 2005, "General Motors Vehicles Hit with Another Safety Investigation: NHTSA to Investigate 1.3 Million GM Pickup Trucks and SUVs for Corroding Brake Part," Auto on Info, May 2005, and "Don't Drive That GM Pickup or SUV," Auto on Info, May 2005.

2. General Motors' piston slap debacle (see "Do General Motors' Pickup Trucks and SUVs Make a Grotesque Noise?," Auto on Info, January 2004) and the owner reaction that GM's inability or refusal to repair the problem has generated (see Auto on Info Mini-Survey No. 65, "GM's Piston Slap - Engine Knock").

3. The extent to which consumers now equate GM with junk. (See "Does 'GM' Mean 'Junk'?" Auto on Info, May 2005.)

4. The reality that Chrysler's Dietr Zetsche is dangerously competent, something likely few people would accuse a GM executive of being.

Chrysler, with a 1996-2000 RPA of .33, saw its May 2005 U.S. auto sales rise 6%.

Ford, with a 1996-2000 RPA of .50, saw its May 2005 U.S. auto sales fall 3%.

Toyota's and Nissan's higher U.S. market shares and GM's lower U.S. market share continue to hold. The year-to-date and historical U.S. market shares, together with natural market share estimates, are given in the table below.

In the Hyundai vs. General Motors war, Hyundai, with a 1996-2000 RPA of .31, trounced GM in May with a 9% increase in U.S. auto sales. Kia, viewed by South Koreans as the lesser of the nation's two main auto manufacturers, also trounced GM in U.S. auto sales with a 9% increase.

U.S. May 2005 auto sales by Saab, a European subsidiary of General Motors with a 1996-2000 RPA of .50, rose 8%, but sales by Volvo, a European subsidiary of Ford with a 1996-2000 RPA of .29, fell 1%. Benefit from yesteryear's European renown may be waning, but only slowly.

In the niche markets, Porsche May U.S. auto sales soared 35%, BMW sales rose 5%, and Mercedes-Benz sales rose 6%.

Note: Big Three sales and market shares do not include sales of European lines - Mercedes-Benz, Saab, Volvo, Jaguar, and Land Rover. Percentage unit sales changes for May 2005 over May 2004 are daily selling rate percentage changes and consequently take account of the fact that there were 24 selling days in May 2005 and 26 in May 2004.

Source for May 2005 auto manufacturer sales data: "May 2005 U.S. Auto Sales," the Associated Press, available at Yahoo! News.

Source for detailed Toyota sales data: "Toyota Reports Strong May Sales," June 1, 2005, at http://pressroom.toyota.com/photo_library/display_release.html?id=20050601

Source for Nissan sales data: "Nissan North America Announces Best May Sales Ever," June 1, 2005, at http://www.nissannews.com/corporate/news/current/20050601102248.shtml

Source for Honda sales data: "American Honda Reports May Sales Results," June 1, 2005, http://hondanews.com/CatID1000?mid=2005060148809&mime=asc

Source for absence of Subaru sales data: www.media.subaru.com

Source for Mazda sales data: "Mazda Announces May '05 Sales," June 1, 2005, available at http://media.ford.com

Source for General Motors sales data: "GM Reports 393,197 Deliveries in May," June 1, 2005, accessible at http://media.gm.com

Source for Reliability Percentranks and Percentrank averages: Auto on Info's Table I-MVRP

Source for July 2004's Hottest Ten: "Hot Off the Lot," Wall Street Journal, August 11, 2004, p. D4 (See "Toyota Has Four of July 2004's Hottest Selling Top Ten; Honda, BMW, and DaimlerChrysler - Each Two," Auto on Info, August 2004.)

Sources for Consumer Reports 2004 Quick Picks: Consumer Reports, February 2004, p. 49 and Consumer Reports, May 2004, p. 53, Consumer Reports, August 2004, p. 51, Consumer Reports, December 2004, p. 59

Source for CR 2004 Top Picks: Consumer Reports, April 2004, pp. 8,9

Source for CR 2005 Top Picks: Consumer Reports, April 2005, pp. 6,7

Source for CR 2005 Quick Picks: Consumer Reports, April 2005, p. 31

Source for CR 2005 predicted short-term reliability ratings: "Vehicle Profiles: A User's Guide," Consumer Reports, April 2005, pp. 40-73

Sources for IIHS Best Pick Frontals: "Toyota Camry and Honda Accord Dominate Results of IIHS' Frontal Offset Crash and Side Impact Tests," Auto on Info, April 2005, "Toyota Sienna and Honda Odyssey Minivans Score Best on IIHS 2005 Crash Tests, Receive "Best Pick Frontal" Designation; GM's Chevrolet Astro, GMC Safari, Pontiac TransSport / Montana, and Chevrolet Venture Score Worst," Auto on Info, April 2005, and "Toyota Tacoma Pickup Truck Scores Best on IIHS 2005 Crash Tests, Receives "Best Pick Frontal" Designation," Auto on Info, April 2005

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