Jeremy Hobson: Auto sales for the month of March are trickling out this month and so far the numbers look pretty good. Chrysler said it had its best month in four years with sales up 34 percent. Ford also had its best month in years with sales up five percent.
And that’s where we’ll start now with Juli Neimann, analyst at Smith Moore & Company. She is with us live as always from St. Louis. Good morning, Juli.
Juli Neimann: Good morning, Jeremy.
Hobson: So it seems like high gas prices don’t seem to have deterred people from going out and buying cars.
Neimann: Only to some extent. Of course everyone’s going to be watching it because if more of your money is going into the gas tank, that’s less available to spend other places. But the key with the automotive industry is “do you have a job?” and that’s what we’re watching out for. Jobs are picking up or at least stabilizing in certain areas and as long as we see growth in the job area, you’re going to see a pickup in auto sales.
Hobson: Well I know that we saw that GM said it sold a record amount of these fuel efficient cars, cars that get better than 30 miles a gallon on the highway. Are people going out and buying the really fuel efficient cars like the Nissan Leaf, these electric cars?
Neimann: If you take a take a look at the Volt and some of those, they’re going to be on extended vacation here, simply because they’re too expensive. And it really is still experimental technology that you’re looking at here. Fuel efficiency is the key thing. Foreign competition really gave us the push to fuel efficiency. You know, five, six years ago, you basically had a choice among three fuel efficient vehicles and the rest were all guzzlers. Now you’ve got 40 from which to choose and you don’t have to buy a car you can barely squeeze into. So the options are out there, people are moving in that direction, and the key is fuel efficiency.
Hobson: And Juli, quickly, where are we now compared to pre-crash levels when it comes to car sales?
Neimann: Before the crash, we were selling almost 17 million a year; that was in 2005. Now we’ve plunged all the way down but we’re climbing back, 2011 we were at 12.8, it looks like this year we could come back at 14 million but it’s still a long slow haul back.
Hobson: Juli Neiman, analyst with Smith Moore & Company, thanks as always.
Neimann: You bet.