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GM reports first-quarter sales gain, record prices despite tight inventory

Jamie L. LaReau, Detroit Free Press on

Published in Automotive News

Total GMC sales rose 10.5% to 131,239, lead in part by sales of the Sierra pickups, which collectively sold 62,917, an 18.7% gain. The mid-sized Canyon pickup also delivered a gain of 59.4%, selling 7,144 vehicles. The Yukon large SUV sold 18,458, an increase of 31.2% year-over-year.

GM's luxury brand Cadillac had a good quarter, reporting U.S. sales of 37,277, a 22.9% increase over the year-ago quarter. Half of the vehicles in Cadillac's lineup reported double-digit sales gains.

Buick also had a strong quarter lead by sales of the Encore GX. The brand reported 45,784 total vehicles sold, a gain of 35.2%.

Toward the end of the first quarter last year, the pandemic halted U.S. car demand as most states had stay-in-place orders to mitigate the spread of the virus.

In Michigan, dealers could not sell cars for nearly three weeks.

This year it's the industry-wide shortage of semiconductors that has hit GM, forcing it to idle several plants due to a lack of parts. Despite GM CEO Mary Barra saying in February that the chip shortage would not affect production of GM's highly profitable pickups and SUVs this year, it has.

 

GM ended the quarter with 334,628 units in inventory, down 76,247 units from the end of the fourth quarter. To help dealers maintain sales, GM has introduced new proprietary software and applications that help them optimize their vehicle orders and track the vehicles as they come from factories.

Beyond the chip shortage, GM's production of full-size SUVs was crippled in the quarter due to severe winter storms idling its Arlington Assembly plant in Texas and its full-size pickup plant in Fort Wayne, Indiana.

But consumer demand for those vehicles keeps transaction prices high.

“These aren’t great market conditions for bargain shoppers, but consumers who have the advantage of a trade-in toward their next purchase might be able to look forward to getting a bit more for their vehicle than usual as demand for used cars continues to run high," said Ivan Drury, Edmunds’ senior manager of insights.

GM said Cadillac had its best first-quarter average transaction price ever at $58,550. Sales of the redesigned Escalade rose 75.1% to 9,842 units and that carries an average transaction price of more than $100,000, GM has said.

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