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Auto sales up sharply in July

Associated Press

DETROIT — The Big Three U.S. automakers are extending programs that let customers buy vehicles at the employee price after seeing sales leap in July, but analysts warned on Tuesday that automakers could see some payback this fall.

General Motors Corp., the world’s largest automaker, said its sales were up 19 percent over last July. That was less dramatic than the 41 percent increase in June, when GM became the first automaker to introduce an employee-pricing deal, but the company said it was pleased with the results. Paul Ballew, GM’s executive director of global market and industry analysis, said it was the best July for GM since 1979.

GM’s truck sales rose 34 percent in July while car demand was off 4.6 percent. Overall, GM’s sales were up 5 percent for the first seven months of the year, boosted largely by June and July volume.

Ford Motor Co.’s sales jumped 35.5 percent in July. Sales of Ford, Lincoln and Mercury trucks were up 38 percent over last July, while car sales rose 26.7 percent. The discount gave a lift to what had been a lackluster year for the nation’s No. 2 automaker. Ford’s overall sales increased just 1.7 percent in the first seven months of the year versus a year ago.

Ford said its F-series trucks set a record for the highest monthly sales of any vehicle since the 1920s. F-series sales were up 58 percent in July to 126,905. F-series truck sales were up 4 percent for the January-July period.

“I actually saw people smiling this month,” said Ford’s U.S. sales analysis manager George Pipas. “There was a sense of excitement in the results as we progressed through the month, and I think restoring that winning attitude was something you can’t put a price on.”

Sales percentages are adjusted for differences in the number of selling days. There were 26 selling days in July 2005 and 27 in July 2004.

The Big Three discounts help boost sales for all automakers, including Asian brands that didn’t offer similar deals.

Nissan Motor Co. said it had its best ever U.S. sales month on record. Nissan sales were up 19 percent over last July, led by a 24 percent increase in truck sales. Nissan’s overall sales were up 16 percent in the first seven months of the year.

GM’s employee-pricing program was so successful in June that Ford and DaimlerChrysler matched the program in July. The employee-pricing plans were scheduled to end Monday, but Ford and GM are extending employee-pricing on 2005 vehicles until Sept. 6 and Chrysler is extending the deal indefinitely. Ford also is discounting some 2006 models.

John Rogin, who owns GM dealerships in Michigan and Ohio, said he has only a two weeks’ supply of 2005 vehicles left after two months of employee discounts. Most large dealers have a 30-day supply, he said.

“They can’t slow the momentum, and what are you going to put on the ‘05s to get rid of them?” Rogin said.

GM shares were down 13 cents to $36.73 in afternoon trading on the New York Stock Exchange. Ford shares were down 1 cent to $10.84.

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