U.S. Auto Sales Expected To Jump 19 Percent In April

DETROIT (AP) — Car buyers worried about vehicle shortages this summer are coming into dealerships earlier than they'd planned, dealers say, ensuring they can get the car they want. April sales, which will be reported Tuesday, are expected to be up 19 percent compared with last year, and dealers say the increase is at least partly due to anxious customers.

DETROIT (AP) — Car buyers worried about vehicle shortages this summer are coming into dealerships earlier than they'd planned, dealers say, ensuring they can get the car they want.

April sales, which will be reported Tuesday, are expected to be up 19 percent compared with last year, and dealers say the increase is at least partly due to anxious customers.

The earthquake is on peoples' minds, says Adam Skolnick, general manager at Toyota Scion Watertown in Massachusetts. "Every time they turn on the TV or computer, they see this and they're aware of it," he says. "There is more of a sense of urgency because they don't want to be left without a vehicle."

The auto industry has been assessing damage from the March 11 earthquake that hit Japan, devastating suppliers and shutting down production at automakers for weeks. Analysts estimate that production has fallen by about 500,000 vehicles so far, and that number will continue to grow. Toyota has said it won't return to a regular production schedule in Japan until November at the earliest. Although Japanese automakers are the hardest hit, Ford, General Motors and Chrysler have all curtailed production.

"As inventories rapidly deteriorate, April could be the last month that we'll see strong sales numbers until late summer or early fall," says Edmunds.com Senior Analyst Jessica Caldwell.

The jump in April's sales could be curbed by tornadoes that hit the southeast at the end of the month. The last weekend of a month traditionally accounts for a large chunk of sales.

The effects of the Japan earthquake continue to ripple through the industry. Few Japanese auto plants were seriously damaged, but some parts suppliers suffered major damage. Disruptions in electricity from stricken nuclear power reactors left many suppliers incapable of restarting, even if their factories were intact.

On Monday, Honda warned dealers that the 2012 Civic, as well as other models, will be in short supply this summer. It also pushed back the fall launch of the CR-V small SUV by at least a month.

Atsushi Niimi, executive vice president of global production and engineering for Toyota, says microchips, rubber components and paint additives are the main supply concerns for the company.

The primary impact will be on brands manufactured solely in Japan. Small cars such as the Honda Fit and Toyota Yaris, which are both made solely in Japan, could be in short supply, says Jesse Toprak, vice president of industry trends and insights for TrueCar.com, a website that tracks what cars sell for at dealerships.

The ongoing auto supplier crisis in Japan hasn't yet translated into a shortage of most cars and trucks on U.S. dealer's lots. Prices are inching up on some brands and models - like Mazda, Toyota, and Honda.

For now, there is plenty of inventory of many models, enough to last two months in many cases.

"Right now, they've got ample inventory that's already here in the U.S.," says Mike Stankard, managing director of Aon Risk Solutions' Automotive Practice. The only customers who may be out of luck are those who want a specific car color - like black or red - and want a car that's made only in Japan, like the Toyota Prius. "But that's a very small percentage of the marketplace."

Mike Jackson, CEO of AutoNation, the largest dealer chain in the U.S., says he doesn't expect to see major supply disruptions at Japanese automakers until June or July. Dealers for those companies are accustomed to working with lean inventory, he says.

"They've done it for years," he says. So they know how to coax customers into being flexible, or to work with other dealers nearby to help people get the cars they want. "There can be significant inventory reduction before there is a meaningful impact on sales."

Despite all the talk about shortages, dealers say they aren't getting worried.

"I've been doing this for 40 years, and I've been through everything you can go through, and we've never run out of cars," says Dawson Grimley, president of Davis-Moore Nissan in Wichita, Kan. "And I don't see it happening now."


Copyright 2011 The Associated Press.

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