March U.S. auto sales: up 12 about percent image

This month, U.S. auto sales are expected to rise 12 about percent, but high gasoline prices and the Japanese disaster will hit hard the auto industry in short time, investors and analysts said.

“Gas prices and disruptions with the Japanese earthquake are relevant, we pay attention to them, but it doesn’t change the medium- or longer-term backdrop of there being some compelling fundamentals for new-car sales,” said Walter Stackow, a senior research analyst with Manning & Napier.

According to Reuters, March is traditionally a stronger sales month than February, but lower incentive spending by General Motors Co, Toyota Motor Corp and others likely resulted in a lower growth rate than February’s 27 percent gain, analysts said.

Mark Farrington at Fuoco Honda says that car-buyers have become increasingly savvy over the past few years. He says that most people immediately ask how many miles per gallon of gasoline a car can get.

On the same time, sales of used vehicles have increased steadily in recent months.

And just when gasoline prices are rising and hybrid cars are again hot sellers, the Japonese disaster is making hybrids and new electric cars tough to get.

Honda Motor Co. and Mazda Motor Co. plans to reduce exports to the United States, and Toyota Motor Co. is preparing for the possibility of suspending production in North America.
Toyota now makes 12 different models in North America, including high-volume vehicles such as Camry, Corolla, RAV4, and Lexus RX 350, and nearly 70 percent of all Toyota and Lexus vehicles sold in the U.S. are made in North America.

However, the problem comes from some electronic parts that come from Japan.
GM, for instance, gets transmissions for its battery-powered Chevrolet Volt from a Japanese supplier.

Also, many of the world’s auto makers, including Ford Motor Co., Chrysler Group LLC,Volkswagen AG, BMW AG, Toyota Motor Corp. and General Motors Co., use Xirallic in metallic paints known for their glistening, shimmering appearance. And this pigment comes from only one factory that is located in Japan.
This Onamaha plant is very close to the Fukushima-Daiichi Nuclear power station which has been severely damaged due to the March 11 Tsunami, resulting in evacuation of people living in surrounding areas.

Onahama plant too has been evacuated for safety reasons.

Automakers are set to report March auto sales on Friday.