Gas prices, fewer incentives weaken auto sales in May

General Motors Co., Ford Motor Co., and Toyota Motor Corp. reported Wednesday that U.S. sales in May fell as higher gasoline prices and smaller discount offers deterred purchases.

GM deliveries dropped 1.2 percent to 221,192 vehicles, the Detroit-based automaker said Wednesday in a statement. Ford light-vehicle deliveries fell 2.6 percent to 191,529. Toyota's U.S. sales plunged more than analysts had estimated.

Gasoline that has topped $3.50 a gallon since March and automakers' "dramatic" cuts to incentives led some buyers to defer purchases, said Don Johnson, vice president of U.S. sales at GM.

Toyota and Honda Motor Co. led declines among major automakers as Japan-based manufacturers worked to recover from the earthquake and tsunami that idled factories and created a shortage of parts and vehicles.

Toyota, which built 45 percent of its cars in Japan last year, reported a 33 percent drop in May deliveries. Tokyo-based Honda said sales fell 23 percent.

U.S. sales for Nissan Motor Co. dropped 9.1 percent last month, according to a statement.

Chrysler Group L.L.C. sales rose 10 percent to 115,393 vehicles. The Auburn Hills, Mich.-based company repaid $7.6 billion in U.S. and Canadian government loans during the month.

Hyundai Motor Co., South Korea's largest automaker, reported a 21 percent sales increase, and affiliate Kia Motors Corp.'s deliveries climbed 53 percent. The companies, which operate separately, sold a combined 107,426 vehicles last month, more than either Honda or Nissan.

GM, the largest U.S. automaker, repeated its forecast for U.S. industry deliveries of 13 million to 13.5 million this year, including medium- and heavy-duty trucks, as the automaker expects sales to recover late in the year.

GM ended May with U.S. inventory of about 584,000 vehicles, up from about 577,000 units at the end of April. There were about 110 days of supply of large trucks at the end of May, and inventory of the Chevrolet Cruze compact car was about 37 days.

Ford ended the month with 397,000 vehicles in U.S. inventory, a day supply in the "low-50s," sales analyst George Pipas said on a conference call. The average transaction price for its models climbed about 4 percent in May, he said.

The industry's lower sales in May represent "a pricing- driven decline, not an economic indicator," said Jeremy Anwyl, chief executive officer of Edmunds.com.

Light-vehicle sales climbed to 11.6 million in 2010 from a 27-year low in 2009. Deliveries still were 31 percent fewer than the 16.8 million annual average from 2000 to 2007, according to Autodata.