Sales Surge for Family Cars, More Expensive Vehicles

Cash for Clunkers infused $1 billion into car shoppers’ hands at the end of July 2009, boosting overall sales numbers for nearly every automaker during one of the industry’s worst periods in recent history.
We wrote a number of times during the program that sales of inexpensive cars did well because folks were looking for the best deal. Inexpensive cars also tend to be small cars. Fast-forward to July 2010, and sales numbers were significantly higher than the government-incentivized numbers of July 2009. If that isn’t a sign of recovery, the uptick in sales of more expensive non-luxury and family cars should be.

The best example of this boost can be found in family-friendly vehicles like crossovers and even minivans. Honda saw sales overall fall from last year, mainly because its big sellers Accord and Civic took hits, down 17.9% and 25.5%, respectively. The small Fit was also down 29.8%, but the Odyssey minivan and Pilot SUV saw big spikes of 37.8% and 45.4%, respectively despite starting prices around $27,000.

Honda’s not the lone example. Ford’s inexpensive Focus compact car sold especially well during Cash for Clunkers but saw sales fall 29.4%. But sales of the Ford Edge and Explorer SUVs rose 18.9% and 53.2%, respectively despite redesigns of both heading to dealers later this year.
At GM, sales of its remaining brands were up 24.6%, and its inexpensive cars didn’t see as big a hit as others, with the Chevy Aveo and Chevy Cobalt down 14.6% and 22.2%, respectively. Chevy’s nearly $30,000 Traverse crossover saw sales jump 49.1%, and its more expensive siblings, the GMC Acadia and Buick Enclave, also saw sales go up slightly.
More families buying new, more expensive vehicles might signal that the middle class feels more secure this summer than last in terms of the economy and making large purchases. We have already seen the luxury car market rebound. Perhaps now main street is feeling more secure.


Amuro Ray

I don't think I can agree with you here, D.T., as I would say that you are making a large generalization about the health of our economy compare to luxury car sales. Today's release of various financial reports all point to bad news
- unemployment is still extremely high @ 9.5 national;
- decline in housing, consumer confidence, and factory orders;
- decrease and anticipated further reduction in payroll;
- decrease and anticipated further reduction in consumer spending;
(the above are taken from Aug 3rd, 2010 cnn financial news).
Thus, thgs just don't click here! Where do we get the $ to spend on luxury items? In fact, most auto manufacturers fell short of the forecast growth for the month of July, despite that the #'s are in positive territory.
As per cnn news report, from But much of the improvement came from "lower priced fleet sales to businesses like rental car companies, rather than strong consumer demand. George Pipas, Ford's director of sales analysis, estimated that industrywide sales to consumers rose only 1% in the month, while fleet sales shot up 35%."

I suspected that many of the mentioned vehicles, including Honda's minivans and SUVs are being sold as fleet or rentals, as a way for any manufacturers to offload their huge inventories in this economy. Yes, this is rare, but I think that's how it is happening right now. Big SUV & Minivans (not counting luxury brands like Infiniti, Lexus, Acura, etc.) were selling at very attractive prices, hence many rental/fleet companies are getting them now (they too were on budget constraints to get large vehicles earlier, and that's why most rental companies have shortages of large vehicles in 2009 and 2010).

That's just my thought from the reports I've seen. Unfortunately, without further breakdown of data (by location, by time frame, and by population), I don't think that it's fair to say that we're out of the woods at this point...

Ira Goldberg

Wow this writer is clueless! Sales are up from all time lows so this means the economy must be recovering!? You must also be one of those suckers who loves to hear our government officials say, "We have created or SAVED millions of jobs."

Actually last July was the first part of an uptick in sales so compared to June 2010 July 2010 should have been a much harder month to achieve positive results vs June 2010.

Yet we're seeing them. Thus the big drops in the small cars. The Corolla and Civic are still top ten sellers despite the big drops.

Many automakers aren't just seeing increases vs. last year, audi, kia, hyundai and subaru are achieving all time results, or close to it.

I purposely picked vehicles with low fleet sale percentages as well and that MSRP all near $30,000. That's above the national average price which is in the high $20s.

I see your point on the economy figures which don't look good. But in two weeks new numbers will point higher, than in another two weeks lower.

I've followed car sales numbers for years and find them a pretty good indicator of the overall economy, as do many analysts.

They go directly into those larger indicator numbers you mentioned, which by the way were from June, not July.

Amuro Ray

We'll see, DT. I surely hope that u r right, 'coz good economy means more people working and getting better paid. Nevertheless, the #'s just don't click.

Though u r right that the figures for national economy were from June, it's just tough to rebound within just 1 month, u know what I mean? Besides, the economy meltdown we've this time is global related & tied, unlike previous ones, thus making prior analysis less reliable. Oh well, I'm an engineer, not a true economist, so who am I to say economy is better or worse? Hahaha

BTW, how come Collins are doing a lot of posting nowadays? Knowledge transfer...?

Jordan Arnold

Well at least we know does not employ an economist or anyone with a remote understanding of the state of the economy. Don't let these figures ruin your fantasy about the economy recovering:
GM sales rose 1.5%. They were expected to increase 9.6%. Ford sales fell .7% when analysts targets were 10.2% growth. Consumer confidence is down for the fifth straight month and the jobless rate remains at a 27 year high. Outside of that the economy must obviously be recovering given that "sales surge for family cars."

To be clear I never said the economy was all rosy because these specific vehicles' sales were going up. But they are very specific types of vehicles that not everyone buys. Nor did I claim I was an economist.

We point these out because you can't say one specific group buys Accords or Civics versus another. And while many people besides families buy large crossovers that is the majority of buyers and during the last year we definitely saw sales of these vehicles behind the others as families held off the purchases and we wrote about that.

Even my phrasing says "perhaps" etc. So there's no huge declaration being made, just highlighting sales of very specific vehicles going up while others are going down.

Also, Jordan your numbers for GM and Ford are incorrect unless you're pointing to some figure that is not overall sales.


What economy? Creating road construction and government jobs is not economy. Economy is producing something and selling it abroad for THEIR currency, which can be exchanged for gold, diamonds, etc. And finally selling our real economy to China and having unfair free trade is getting back to us. Our government for years let out corporations fool some of us. They said, making stuff in China will make it cheaper for consumers but they forgot to tell the consequences. Right now consequences are such that China basically own the technology and we have nothing. What we did, we moved our engineering achievements over there and gave it for free, while all these years we could rip the benefit of having the technology nobody else has and sell products to them. But corporations didn't want it. They wanted to flood the world with cheap products on the back of the country, which allowed them for such achievements.


I was curious about the numbers Arnold posted so I did some Googling. I found similar numbers on Bloomberg and two other sites so it appears the numbers are valid.


An increase in the sales of durable goods, such as vehicles, from one year to the next, is an indicator in an economy that is growing. I am an Economist.

Thanks for the link. Those are Daily Selling Rate numbers, we typically reference total volume since not every automaker uses DSR in their reports. Both are valid.


Dave - I'm in 100% agreement and think the poster should have taken that into consideration instead of jumping to conclusions.


David Thomas is the poster and he can jump to any conclusion he wants to.

Interesting, would be keen to see what the number are like now.

Temporary Blip?

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