Mother Nature, economy impact local auto sales

Still feeling the impact from last year’s BP oil spill and damage resulting from Japan’s record-setting earthquake and tsunami, auto dealers in the Tri-parish region report a range of activity from definite losses to slight gains in sales during the past year.

In June, a typically slow car month, overall U.S. auto sales of 11.4 million units offered a slight increase from the 11.2 million cars and trucks sold during May.

Ford saw a 14 percent jump from June 2010 to June of this year, General Motors posted an 11 percent gain for the same period and Chrysler listed a 40 percent increase in all categories of auto sales.

While domestic automakers saw a boost in inventory movement, Toyota and Honda each listed a 21 percent loss in sales from June 2010 to June of this year.

“Honda sales are down because of the tsunami and earthquake in Japan,” Barker Honda Managing Partner Lester Bimah said of sales from his Houma dealership. “Eighty percent of our cars are built in the United States, but the parts do come from Japan. So the passage of supply is down in Japan because of the tsunami and earthquake. That’s the only reason. [Sales] are down for everybody.”

Bimah said he expects to see local Honda sales rebound to normal levels by the end of August or in September.

Domestic auto sales in the region have seen slight gains according to Golden Motors sales manager David Boudreaux in Cut Off. “Business has been pretty consistent,” he said of his Buick and Chevrolet sales. “I don’t have the exact figures, but this year business has picked up a little more.”

Boudreaux, along with other dealers, said that as oil field operations in the Gulf of Mexico begin to increase and consumer confidence builds, they expect to see mounting activity on their car lots.

Information provided by 20 regional dealerships showed that comparative units sold in 2009 and 2010 yielded an increase in sales for 13 dealers while the remaining seven experienced a decline in units moved.

Overall, Courtesy Toyota Mazda in Morgan City topped the list with 136 more units sold in 2010 than during 2009. They were closely followed by Trapp Chevrolet Cadillac in Houma, which moved 135 more units in 2010 than they did during the previous year. The most total units in increased year-to-year sales after that was at Courtesy Chevrolet Buick GMC in Franklin, which saw sales boost by 91 units.

Terrebonne Ford in Houma remained the largest seller of trucks, SUVs and vans in southeastern Louisiana for a second year in 2010 when they moved 886 units in that category. The most passenger cars sold in the Tri-parish region during the same period took place at Baker Honda in Houma with 359 units moved.

Increased overall auto sales flew in the face of more than a 5 percent jump in pricing for most new light vehicles during the past year, while dealer incentives were at their lowest numbers since November 2010, according to Edmonds Auto Observer.

“Average transaction prices reached their highest levels ever recorded [in May],” TrueCar.com Industry Trends and Insight Vice President Jesse Toprak said in a printed statement. “Even though consumers continued to move toward smaller vehicles, they also chose highly contented vehicles that are higher priced, keeping transaction prices high.”

While a tight economy has caused many consumers to cut back in most areas of living, those in the auto industry contend that their customers still see cars and trucks as a priority.

“[As] people get more confident in the industry and more confident in their jobs they will start spending money,” Boudreaux said.

Multiple auto sources contend that several factors will come into play for car and truck sales during the remainder of 2011. Economic conditions and jobs, combined with tightened financing opportunities, higher prices and reduced incentives are expected to result in a less than impressive year for auto sales.

“I needed a new car,” said Dinah Condley regarding her purchase of a 2011 Ford Escape on Thursday. “I lost my other vehicle in an accident.”

While in the past dealers were able to entice buyers based on their wants, shoppers on lots contend that for the foreseeable future their purchases will likely be based on need. Indications are that consumers still feel the impact of hardships and their actions will in turn influence what is seen in auto sales.