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Saturday, April 3, 1999

Daimler Chrysler posts record sales in March 

Jeffrey Ball  
Detroit, Apr 2: In a sign of the US economy's continued strength, several major auto makers, including DaimlerChrysler AG, reported record March sales, powered by demand for pricey trucks.

DaimlerChrysler said daily adjusted March sales for Chrysler brand vehicles jumped 16 per cent, pushed by record sales of Jeep sport utility vehicles, a 31 per cent surge in minivan sales and a 31 per cent increase in sales of Dodge Durango sport utilities.

DaimlerChrysler said combined first-quarter sales for its Dodge, Chrysler, Plymouth and Jeep brands rose 14 per cent to a record 6,61,267 vehicles. Growth was slower at the company's Mercedez-Benz unit, where total US sales fell 1.5 per cent in March, to 16,054 vehicles, and edged up just 0.42 per cent in the quarter, to 40,536 vehicles. DaimlerChrysler stock rose $1.75, or two , to $87.5625 in New York Stock Exchange composite trading Thursday.

``The numbers are through the roof,'' said David Bradley, an auto analyst at JP Morgan Securities. But he cautioned thatthese numbers, the latest in a string of monthly record sales results, are sparking investor concerns that the good times can't last forever. ``The sentiment is, `It can't get any better than this. This isn't sustainable','' he said.

David Garrity, an analyst at GVA Research, said DaimlerChrysler may not be able to keep up with demand for its Durango and Grand Cherokee. DaimlerChrysler soon is ``going to be capacity-constrained,'' he said. That will give other auto makers, particularly General Motors Corp, ``an opportunity to recover light-truck [market] share,'' he said.

With sales so hot, a DaimlerChrysler official said he doesn't expect the company will substantially increase discounts in the coming months. ``On the average, they might be up marginally,'' said Jamie Jameson, DaimlerChrysler's vice-president for sales and marketing operations. But ``don't look for any sharp changes,'' he said. ``Overall, we're not escalating the fight.'' GM and Ford Motor Co, which together account for about 55 percent of the US vehicle market, report their March and first-quarter sales next week.

But based on the numbers reported Thursday, analysts are boosting their estimates of the year's total US vehicle sales to between 16 million and 17 million vehicles, close to record levels. DaimlerChrysler has ratcheted up its projection every month this year; its industrywide estimate now stands at 15.8 million vehicles. ``We're not going to take our hand off the throttle,'' said Jameson.

Other auto makers, including Honda Motor Co, Toyota Motor Corp and Volkswagen AG, also reported torrid March sales. Honda reported a record-setting March even though daily adjusted sales of its cars dropped 7.4 per cent during the month. The reason: That decline was dwarfed by a 55.3 per cent surge in truck sales.

Nissan Motor Co, AB Volvo and Mitsubishi Motor Corp also reported March sales increases. But Nissan, where daily-adjusted sales in the month rose four per cent, to 56,367 vehicles, bucked the truckheavy trend. While itscar sales jumped 1.6 per cent, its truck sales declined 0.8 per cent.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.


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