GM’s first quarter sales up 3.9% on strong consumer demand

DETROIT – General Motors vehicle sales were supported by strong consumer demand in the first quarter as fleet sales slumped and a continuing shortage of semiconductor chips closed some assembly plants .

The Detroit automaker said Thursday it sold 642,250 vehicles in the first three months of the year, up 3.9% from a year earlier, when Covid-19 began to force dealers and auto factories to close in March.

GM and the majority of other major US automakers are expected to release their first quarter sales on Thursday. Analysts expect sales in the industry to be up about 8% or 9% from the first quarter of 2020, despite automakers suffering from a shortage of semiconductor chips.

GM said retail sales to individual consumers rose 19% in the first quarter, while fleet sales to businesses and governments fell 35% from the previous year. The automaker expects consumer demand to remain resilient throughout this year.

“Consumer confidence and spending will continue to rise as a result of the stimulus, rising vaccination rates and the gradual reopening of the economy,” GM Chief Economist Elaine Buckberg said in a statement. “Automotive demand is expected to remain strong throughout the year.”

The GM brands Buick, Cadillac and GMC saw double-digit sales increases in the first quarter, while Chevrolet – its biggest brand – fell 1.7%. Chevrolet’s decline was attributable to a 12.5% ​​drop in sales of its full-size Silverado pickups.

Automakers that traditionally rely less on US fleet sales saw larger increases than GM in the first quarter. They include: Volkswagen, up 21%; Toyota Motor, up 21.6%; Hyundai Motor, up 28%; and Kia Motors, up 22.8%.

Hyundai sales have been particularly impressive. For the quarter, the South Korean automaker’s results were led by a 38% increase in retail sales, including its best monthly and total retail sales in March.

“We’ve had a great month. All-time records, I mean almost unexpectedly,” Jose Munoz, CEO of Hyundai North America, said Thursday on CNBC’s “Squawk on the Street.” “I must be optimistic, but there are many challenges these days in the auto industry.”

Ford, the second-largest American automaker behind GM in the United States, is not expected to release its first quarter domestic sales until Monday.