Top U.S. automakers General Motors and Ford reported an increase of 5% in July sales from a year earlier, results they said pointed to a slow but steady turnaround for the battered sector in the third quarter.
The sales increase for Ford was lower than some of the more bullish analysts had forecast and the automaker's shares dropped as much as 2.9%.
July sales for Hyundai rose 19% while sales for its affiliate Kia were up almost 21%. Nissan posted a sales rise of almost 15%.
Auto executives said the early sales numbers for July eased concern that the industry could be tipping back toward recession after weaker-than-expected June sales results.
The stronger auto sales for July came as indicators for U.S. consumer spending and incomes for June were flat, data economists said pointed toward a still-anemic recovery.
GM said its results underscored the progress it has made as as a smaller and more focused company in the year since its emergence from a U.S. government-funded bankruptcy.
GM's sales figures are expected to represent the last monthly sales update from the top-selling U.S. automaker before it files for a stock offering. The IPO is expected to reduce the U.S. government's GM ownership stake of 61%.
GM executives said the July sales results show its progress in managing inventories, reducing costly sales incentives and building momentum with a more balanced line-up and sales gains for both cars and trucks.
Sales of GM's four remaining brands — Chevrolet, Cadillac, GMC and Buick — were up almost 25% from a year earlier in July.
But including the brands GM dropped in its restructuring — Pontiac, Saab, Saturn and Hummer — retail sales in July were down 3.8% from a year earlier.
That key subset of sales excludes the 25% of GM sales that went to fleet operators like rental car companies, and it is watched as an indicator of an automaker's pricing power and popularity.
GM said it was keeping its forecast for full-year industry-wide U.S. sales unchanged at 11.5 mln to 12 mln vehicles at the start of the second half.
FORD SHARES DIP AFTER RALLY
Ford's sales were boosted by a nearly 40% gain for F-Series pickup trucks — the best-selling vehicle in its lineup — and early sales of the Fiesta, its smallest car and newest entry.
The 5% July sales gain for Ford sales was for its Ford, Lincoln and Mercury brands and excluded sales for Volvo. Ford this week completed a deal to sell the Volvo brand to China's Geely.
Ford shares, which have gained more than 20% in the past month, were down 2% at $12.90 on the New York Stock Exchange in early afternoon, off an earlier low at $12.77.
Industrywide auto sales are expected to top the 1 mln vehicle mark in July, a single-digit increase from both the previous month and the same month in 2009 when sales were lifted by the first week of the government's cash-for-clunkers sales incentives.
