By Ed Ryan
No matter how much GM's wince when they see how much their monthly business is dependent on auto, they giggle with glee every time that order sits on their desk awaiting a signature. So what if three car dealers run back to back to back in a stopset. So what if they only buy W-F and Saturday morning. So what if the rate is below what your expensive inventory management system spits out. And so what if the spot sounds so bad with screaming egomaniac car salesman turning off listeners. You need the business and you're signing that order.
Yesterday - and all week - while radio's public companies were reporting benign earnings, General Motors came
out with great news and announcements of a price hike. Radio One's Barry Mayo said there are signs auto is coming back. Well, if the GM numbers are any indication of what "coming back" means, he may be right. GM posted a net profit of $2.5 billion for the second quarter, nearly double the $1.3 billion in the year-earlier quarter. Revenue grew 19 percent to $39.4 billion. CEO Dan Akerson said "It was a good quarter and another step in our journey of sustained, profitable growth" during a conference call.
GM's Net income in North America rose 41 percent from the second quarter of 2010 to $2.2 billion. The automaker's struggling European unit posted a $102 million net profit, reversing a $160 million loss a year earlier. GM said it was the first time in many years that all of its regions posted a quarterly profit. And GM is planning price hikes in the near future. GM said today it will raise prices on 2012 models by 1 percent, the third increase this year. GM has hiked vehicle prices 1.9 percent this calendar year to counter rising commodity costs and other expenses. That contrasts a bit with what Saga's Ed Christian said about the auto industry on his conference call yesterday. "Consumers are waiting on the sidelines for deals." Well, if that's true they could be waiting a long time. Other automakers have also raised vehicle prices to offset rising costs.
Here are some numbers from Automotive News. Through the first 7 months of 2011, Chrysler is up 21% GM is up 16% and Ford is up 9%. Honda was off 3% and Toyota was down 7%. Toyota is often the company radio executives blame for weak auto advertising, having to do with the earthquake in Japan. Overall automotive sales are up 11% for the first 7 months in the United States. 7.3 million units have been sold compared to 6.6 units in 2010.
Add a Comment Send This Story To A Friend
