Demand for fuel efficiency spurs R.I. auto sales

During the first quarter of 2012, earning reports for the “Big Three” American motor companies, Ford, General Motors and Chrysler, showed that Americans are standing behind their automobile makers, and the Ocean State followed suit in the country’s rekindled love affair with the iconic, American-made automobile.
All three manufacturers credit increased fuel efficiency and better engineering for the improved national sales.
At Balise Chevrolet in Warwick this year’s first quarter was stronger than last year’s. “I think we did very well. We had a mild winter and I’m sure that helped,” said Michael Flaherty, a sales consultant at the dealership.
Recent GM sales have focused on fuel efficiency. Cars such as the Cruze are the company’s “bread and butter,” he said, offering a fuel efficiency of 42 mpg at an affordable price. The “Eco” model has additional features that can bring the mileage closer to 50 mpg. Another strong model is the Equinox, a small, four-cylinder, fuel-efficient crossover. Truck sales at the dealer have flourished as well.
According to the General Motors Corp., in March the company sold 100,000 cars in the United States that had a fuel efficiency of 30 miles per gallon or better on the highway. That’s never happened before. Demand rose for all of its 12 models that get 30 mpg on the highway, about 45 percent of the company’s U.S. sales, versus 16 percent in 2008. In March alone, GM’s Chevrolet Volt, a plug-in hybrid, doubled its February sales.
Flaherty also praised GM for its dedication in improving its quality and striving for more innovative ideas. “Compared to 2008 when they started their restructuring you can really see the difference,” he said. Flaherty said they have tapped into the fuel-efficient market to a greater extent and the new Malibu and Impala models will feature incredible technology and design. The exterior design of the Impala and Corvette will be updated as well.
“We do see the economy getting better. Rhode Island might be lagging behind but it’s getting better,” he said.
Four years ago, the Chrysler Group – owned by Fiat – did not manufacture a model that was more fuel-efficient than 30 mpg, but now it boasts six such vehicles, accounting for 29 percent of the company’s sales in March. Furthermore, the much-anticipated release later this year of the 2013 Dodge Dart, at 40-plus mpg, is waiting in the wings. “The last few years have been a struggle but business continues to get better and better,” said Larry Cronin, general manager at Paul Bailey’s Chrysler, Dodge, Jeep & Ram in North Kingstown. First-quarter sales for 2012 were better than last year’s first quarter. This past December the dealer had the best month in years, pushing 2012 in the right direction.
Cronin noted that Chrysler’s quality has improved on their new products. “It’s only been within the last year that we’ve been able to reap the benefits of their new product pipeline and if you talk to any dealer they’ll tell you they’re more optimistic than they have been in a long time,” he said.
Cronin points to the new Dart as an example of better quality, including its gasoline rating. It’s the first car the company has made since their reorganization and merger with Fiat, which has influenced its design. “It’s exciting because this gives us an entrance into a market that we never had before,” he said.
Together with the Jeep Compass and Patriot, the dealership is stocked with fuel-efficient automobiles.
The Jeep line is popular, he said, because they represent fuel-efficient, four-wheel-drive products. A brand new Jeep Liberty is expected within the next year and promises to be a fuel-efficient sport utility. Another solid bet for the dealer is the Dodge Ram line, where an eight-speed electronic transmission will help push gasoline efficiency near 30 mpg.
“The Grand Cherokee has been a hit beyond anyone’s expectations. It’s been compared to the Range Rover and the most-expensive Lexus, for $20,000 less,” he said, “and they keep on making the minivans better and better.”
Blair Fish, president of Fish Advertising in South Kingstown, represents Flood Auto Group, a Ford and Mazda dealer in East Greenwich, Wakefield and Narragansett. Flood Ford is experiencing another good year and Fish notes that sales are impacted by a number of factors. Ford has stepped up to the plate in terms improving the efficiency and quality of their new models. The public, Fish said, has caught on as well. “In April there was a bump in the sales of the Fiesta and Focus because of gas prices getting at $4 per gallon. That was a big benchmark and the fuel-efficient cars moved quicker than normal,” he said. At the Ford Motor Company, the trend is dramatic; the fuel-efficient Focus hybrid has seen sales increase by 78 percent in the first quarter, giving models such as the Toyota Prius strong competition. The Ford Focus, Fusion and Edge, all of which are fuel-efficient vehicles, each posted their strongest March sales ever, and the company now makes four hybrid and electric cars. The company has also publicly committed to triple production of its hybrid, plug-in hybrid and electric vehicles, and one-third of Ford vehicles get at least 40 miles per gallon, thanks to its EcoBoost gasoline power-train.
According to Fish, the 2013 Escape is arriving soon and appears to be smaller and more apt to compete with crossover vehicles such as the Nissan Rogue and Hyundai’s Santa Fe.
But the Big Three still have work to do when it comes to overseas sales. Ford reported net income of $1.4 billion, 45 percent less than the $2.55 billion it earned in the same period of 2011. GM was strong in North America, with a profit of $1.7 billion, up 35 percent from last year, but globally, earnings fell 69 percent from the same time last year. In Europe, however, GM lost $256 million and in South America their earnings fell to $83 million.
Only Chrysler was successful in non-American sales, posting a 33 percent increase in global sales in the quarter. Chrysler reported strong first-quarter sales with a net profit of $473 million, its best quarter in 13 years, mainly because of strong American sales.
First-quarter sales were up 39 percent. Chrysler’s first-quarter profit was more than four times the $116 million that the company made in the first quarter last year. &#8226

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