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General Motors Company (NYSE:GM)

December 03, 2012 11:00 am ET

Executives

Jim Cain

Kurt McNeil - U S Sales & Service Vice President - Cadillac

Alan Batey - Global Chief Marketing Officer

Don Johnson - Vice President of Chevrolet Sales and Service

Chase Hawkins - Vice President of Cadillac Sales and Service

Mark L. Reuss - Vice President and President of North America

Analysts

John Murphy - BofA Merrill Lynch, Research Division

Adam Jonas - Morgan Stanley, Research Division

Rod Lache - Deutsche Bank AG, Research Division

Brian Arthur Johnson - Barclays Capital, Research Division

Christopher J. Ceraso - Crédit Suisse AG, Research Division

Colin Langan - UBS Investment Bank, Research Division

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the General Motors November 2012 U.S. Sales Conference Call. [Operator Instructions] As a reminder, this conference is being recorded, Monday, December 3, 2012. I would now like to turn the conference over to Jim Cain, GM Communications. Please go ahead, sir.

Jim Cain

Good morning, everybody, and welcome to the GM November sales call. Joining us today to lead the discussion is Kurt McNeil, our U.S. Vice President of Sales Operations. We'll have the discussion followed by Q&A as we always do, and as always, the conversation's governed by our disclosures on forward-looking statements.

With that, Kurt, the floor is yours.

Kurt McNeil

Thank you, Jim. Good morning, everyone, and thank you for joining us. As you've seen from our press release today, GM reported its highest November sales in 5 years with deliveries reaching 185,505 units. That's up 3% versus a year ago.

Now among the highlights, we saw strong car and crossover sales with car sales up 19%, and crossovers up 9%. Importantly, GM continues to make inroads with younger customers, import buyers and fuel economy-focused drivers, thanks to strong sales of our mini, small and compact cars, which were up a combined 51%.

At the high end of the market, the Buick and Cadillac brands are doing very well with sales up 22% and 30%, respectively. Finally, our average transaction prices or ATPs were up $750 per unit versus a year ago even though our car and crossover mix increased from 56% of our total sales to 62% of total sales. ATPs also increased about $190 per unit from October, when our car and crossover mix was about 60%.

Lower incentive spending is one of the factors helping to drive these higher ATPs. As a percentage of ATP, our spending for the month was less than 9% or more than 0.5 percentage point below the industry average based on J.D. Power PIN estimates. Spending is also down more than 0.5 point versus October and almost 2 points below last November.

Based on PIN, GM was the only OEM to reduce incentives from October. When you compare that against last November, half of our key competitors raised incentives and half lowered them, but we had the largest year-over-year decline of anyone in the industry.

In dollar terms, spending was down about $200 per unit from October and $500 per unit from last November. At the vehicle line level, you can see that our positive momentum is being driven by our combination of new products and the sustained performance of the vehicles we launched starting in 2009 and 2010.

At Chevrolet, sales of the Cruze were up 27% versus a year ago, the Sonic was up 12%, and the Equinox was up 13%. All of these vehicles continue to sell strongly with incentives quite a bit lower than the industry average. We're also gaining momentum with the Malibu, which saw a month-to-month increase of 6%.

At GMC, the Terrain was up 44% year-over-year, and at Buick, we reported another strong month of Verano sales and a 23% increase for the Enclave crossover. The Verano is really proving to be an eye-opener for a lot of customers and car critics. We were especially pleased to see the Verano Turbo win the recent Motor Trend comparison test against the Acura ILX. The Enclave, meanwhile, had its best November ever, which helped Buick achieve its highest November sales since 2006.

Over at Cadillac, sales of the SRX increased 13%, and we continued to gain momentum with the ATS and XTS. They helped Cadillac achieve its highest November sales since 2007.

The buzz around these great products is really starting to build, thanks in part to the third-party awards and the recognition we're receiving. These include CUE being selected as Technology of the Year in the telematics category by AOL Autos, and the Cadillac ATS being named Vehicle of the Year by the L.A.-based Motor Press Guild, which is the largest auto press group in the world.

Now on the truck side of our business. We did not achieve our objective for the month. Total truck sales were down about 11%, and our full-size pickup sales were down about 8%.

One of the headwinds we face was related to the model year mix in the full-size pickup segment. As we shared with you on the September sales call, we started our 2013 model year with the GMC Sierra and Chevrolet Silverado about 45 days earlier than last year. That also ended up being several weeks earlier than our domestic competitors when they launched their 2013 trucks. Unfortunately, this left us vulnerable to unexpectedly high incentive activity as competitors ramped up spending to sell down their 2012 model year stock.

A couple of data points will provide valuable context. First, GM had among the lowest incentives in the segment for the third month in a row. Our incentives were $500 per unit lower than the segment average, and the biggest spenders have $1,500 to $1,700 more on their trucks than we do. This makes sense when you consider that roughly 60% of GM retail large pickup sales in November were 2013 models compared to about 35% for Ford and less than 10% for Dodge.

The good news for us is that while sales were down, our large pickup ATPs were up more than $2,700 year-over-year and more than $700 month-over-month. This continues the trend we saw in the third quarter in the month of October when we saw year-over-year ATP improvements in the $2,200 to $2,500 range.

Despite all of these factors, December should be an all-new ballgame. It's traditionally one of the strongest sales months of the year for Silverado and Sierra. Consumers are feeling good. Housing is rebounding, and we remain confident there'll be a resolution in Washington.

Turning to fleet sales. Our total fleet deliveries were up 16% in November and are about 1/4 of our business as planned. Year-to-date, GM fleet deliveries are up about 4%. Rental sales are down slightly, and commercial and government sales are up a combined 13%.

Now I'll close with a few comments on the industry and the outlook, and then we'll take your questions. Let's start with the SAAR, which was approximately 15.3 million to 15.5 million light vehicles in November. The East Coast ongoing recovery from Hurricane Sandy helped drive the SAAR materially higher, perhaps as much as 0.4 points, but it benefited our competitors more than GM given market share patterns. As we look towards December and closing the books on 2012, it's clear that the industry will come in at the high end of our full year forecast, which is for sales of 14 million to 14.5 million.

However, based on the recent results, it's fair to say that our year-end inventory target of 660,000 to 670,000 vehicles is in jeopardy. But keep in mind that December, we'll see seasonally higher sales and low production given the holidays. Having said that, as we've said before, we'll continue to use all levers to influence inventory on a go-forward basis. That includes, first and foremost, adjusting production, as well as marketing activity.

Looking at the national picture, the apparent recovery in housing that we talked about last month and the encouraging new data on consumer sentiment and confidence are all positive factors. For example, consumer confidence rose in November to the highest level in more than 4 years, a sign household spending will keep growing.

And the University of Michigan Sentiment Index is at a 5-year high. It seems pretty clear the fourth quarter will be the ninth consecutive quarter of year-over-year growth in the light vehicle selling rate even though business sentiment has been stagnating as the year-end deadline for automatic fiscal tightening approaches.

Exactly how much growth we can expect next year will depend in part on how Congress and the President resolve the fiscal cliff issue. We are certainly not going to prescribe policy fixes on this call, but I will say that markets and consumers hate the uncertainty. So an agreement on ways to reduce long-term federal budget deficits could remove an impediment to growth. Until we see some resolution, we're going to be conservative and wait to issue a formal sales forecast for 2013.

All right. Let's move to Q&A. Joining us: Alan Batey, Vice President of U.S. Sales and Service and Interim CMO; Don Johnson, Vice President of Chevrolet Sales and Service; Brian Sweeney, Vice President of Buick GMC Sales and Service; Chase Hawkins, Vice President of Cadillac Sales and Service; Ed Peper, Vice President of Fleet and Commercial Operations; and our Senior Economist, Sue Yingzi Su.

Okay. Let's take some questions. Operator?

Question-and-Answer Session

Operator

[Operator Instructions] Our first question coming from the line of John Murphy with Bank of America Merrill Lynch.

John Murphy - BofA Merrill Lynch, Research Division

Just a first question on the pickup environment here. I mean, it sounds like your competition is being a little bit more aggressive according to your numbers because they're dealing with older models in dealer showrooms. But I'm just curious, as we go forward in December, Kurt, and you mentioned this would be an all-new ballgame, are you waiting to see what kind of incentives they will have on their 2013 model year trucks before you respond? And I'm really just trying to gauge if they keep this going, will you ramp up your incentives or will you cut production because it's going to have to be sort of a heavy dose of one or the other here in the next couple of months. And I'm just trying to understand given the competitive environment if it remains competitive, which way you'll go.

Kurt McNeil

Yes, John. Obviously, we can't control their actions. They are being extremely aggressive in that segment. We are the lowest. I think we gave you those data points. I mean Ford, $350 higher, Ram and Nissan, significantly higher $1,400, $1,500 more so that is just the case. But at the end of the day, we want to be known for great products, not great incentives. So that's our philosophy. Alan, do you want to comment on that?

Alan Batey

Yes, John, this is Alan Batey. To answer your question specifically, obviously, we expect that '12 inventory will start to come down and that was really to Kurt's point around we think that as we go into December that the environment will change somewhat. But we saw this very early in the month and frankly, took the strategic decision to stay very, very disciplined. When we saw Dodge with incentives of like $5,000 per unit, clearly we knew that they were going to be liquidating a lot of inventory, and they've got less than 10% of their inventory that was sold at that point was model year '13. So we decided to stay very disciplined. We do believe that it will turn. When it turns, we think we'll be in a really good situation, and that's really been our strategy all year is to stay disciplined and make sure that we balance supply and demand, and as we said, we'll do that. But we're very confident that our strategy is working. When I look at the early data for the month and we had the highest ATPs of the year, we had our lowest incentive spend, a percent of ATP, and we had our lowest incentive spend in dollar terms, which really showed you that we had a lot of really fresh '13 inventory on the ground, and a lot of our competitors were liquidating their inventory. So we just took the decision, stay very disciplined, and that we've been able to register our best sales results since 2007, I think, shows the momentum that we have. And I think December's going to be a great month for us, and December, historically, is always a good retail month. And so we'll be in the mix, and we've got good inventory, and we're going to have good offers in the market.

John Murphy - BofA Merrill Lynch, Research Division

So if I understand what you guys are saying, really it is to constrain production to keep inventory in check as opposed to getting into a price war here. Is that a correct characterization of what you guys are saying?

Alan Batey

Yes, we want to keep supply and demand balanced. We want to really make sure we protect our residual values, and we want to drive the best value equation in the marketplace.

John Murphy - BofA Merrill Lynch, Research Division

Okay, second question. Could you just remind us how much of your fleet business goes to government sales, and what kind of sensitivity you would have around the fiscal cliff if we saw just these straight hatchet jobs across the board? Is there any risk to your government sales if that were to happen, and really what the sensitivity might be.

Kurt McNeil

Yes, John, the -- well, I'll -- usually you ask for the mix of our fleet business so I'll give that to you here. For the month of November, it was 25.2%. Calendar year-to-date, it's 26.4%, which is right in that range that we've been talking to you about. Of that 25.2%, 2.3% was government, 6.3% was commercial, and 16.5% was rental. So it is a factor in our business. Hence, the reason why we would love for the fiscal cliff issue to go away. But it's staying consistent with what we've been at for the year.

John Murphy - BofA Merrill Lynch, Research Division

But the direct impact would be small, it's more the indirect that you would be concerned with.

Kurt McNeil

Right.

John Murphy - BofA Merrill Lynch, Research Division

And then just lastly, the Captiva Sport, it seems like it's doing pretty well in the fleet business. Just curious if you would ever consider selling that at retail because it would slide nicely under the Equinox there. It just seems like a pretty good product. Just curious as to why you would never sell that at retail.

Don Johnson

John, it's Don Johnson with Chevrolet. Yes, right now that vehicle is really, as you noted, a fleet play. Well, one of the reasons we wanted to put it into fleet was to make sure that we could ensure that we had sufficient Equinox for retail, and right now we're still running a low days supply in Equinox at retail, so I don't see that strategy changing.

John Murphy - BofA Merrill Lynch, Research Division

But the Captiva Sport is a size lower than that, or I'm sorry, is that…

Don Johnson

It's a little bit smaller, but it's really -- it's relatively comparable, I would say.

John Murphy - BofA Merrill Lynch, Research Division

Okay. So it is the fleet version of Equinox.

Operator

Our next question coming from the line of Adam Jonas with Morgan Stanley.

Adam Jonas - Morgan Stanley, Research Division

A couple of questions. First, are you able to kind of qualify, I guess, not quantify whether the truck sales were also maybe hurting a bit by all the hype for the new product coming next year started dripping to the market and maybe getting down to the dealer level. Any kind of sense of that?

Kurt McNeil

I mean, that's always the risk, right, Adam? When you start to expose the new product to our dealer body and the industry, that's always some risk involved in that. Alan, do you want to comment?

Alan Batey

Yes, Adam, it's a really good question. I think we had excellent sales in October and a great share, and then we saw what happened in November. And all the reports from the dealers was just the amount of incentive our competitors were loading up and particularly Ford and Dodge, our major competitors. We were shocked when we saw Dodge at $5,000 a unit. We haven't seen those levels, and frankly, we don't think that's sustainable.

Adam Jonas - Morgan Stanley, Research Division

Okay, so it was more the issue of the competitive pricing. And then just moving to inventory, you very clearly say you don't -- you're not confident in the targets anymore, presumably the full-size pickup target of also 200,000 is not something we should expect. At least that's what we're reading from your comments. Are you going to withhold on any kind of order of magnitude or quantification of a year-end target, or do you just want to keep it open-ended, just not expect your old targets to be reached?

Alan Batey

Adam, this is Alan again. Look, I think at the moment, we're going into a market now, into a month now where we have pretty low production and a very, very good sales month to look forward to. We've got 5-weekend month. We expect it to be strong. So we don't think -- I mean whenever you're looking at a range, it's always going to go up a little bit or down a little bit. As I said, we took a conscious decision early in the month not to follow our competitors on these high incentives, and that really tells you that we're very confident that we're in a band where we can afford to flex a little bit. So I don't think our strategy is going to change too much, and you know what, one month doesn't make a year and that's really the way we looked at this. And I think as we come out of December, that we'll have a really good look at it. And if we have to make some tweaks along the way, we will.

Adam Jonas - Morgan Stanley, Research Division

Got it. Well, last question. Just on Sandy, you said the mix was hurt because of the strength in the Northeast helping your competitors more than you. On their call, Ford was talking about the, let's say, the replacement portion of Sandy running well end of the year and into the first half. So presumably this headwind of mix should continue for a number of months. Is that also in alignment with your thinking?

Kurt McNeil

Yes, we -- Adam, historically, the Northeast runs 24%, 25% of our total business. We saw it jump up to 27% in November. I mean, we're spending a lot of time looking at Katrina and trying to compare Sandy to Katrina and what we saw as a result of Katrina, we see a pretty good jump coming December through February and then a sustained improvement through 2013 as they get some economic balance out of -- post Sandy.

Adam Jonas - Morgan Stanley, Research Division

But the share kind of heaviness might also be one side effect. Is that fair?

Alan Batey

Yes, I think that's fair.

Operator

Our next question coming from the line of Rod Lache with Deutsche Bank.

Rod Lache - Deutsche Bank AG, Research Division

Just maybe a point of clarification. Could you give us an idea of what your retail share is like in the Northeast, in places like New York and New Jersey compared with the national average just so we can get a sense of how these mix shifts are just affected by regional differences and your market share?

Kurt McNeil

Yes, it's -- I mean it's -- to swag it, Rod, it's about 13%.

Rod Lache - Deutsche Bank AG, Research Division

Okay. That's retail share?

Kurt McNeil

Yes, sir.

Rod Lache - Deutsche Bank AG, Research Division

Okay, and can you talk about just how you expect some of the new models like Malibu, the large crossovers and Impala, just all of them were down in November, but I know that they're still in ramp-up mode. When do you expect full availability of those models to be out there? And lastly, any comments on just -- I understand you've had a few production constraints on ATS. Is that now behind you?

Don Johnson

Yes, Rod, it's Don Johnson with Chevrolet. I'll address the Chevrolet products you asked about. Obviously, the new Impala has not ramped up at all yet. So we're looking forward to that in the first quarter of next year, and we think with the great design that it's going to give us a great new lease on life in that full-size car category. The new Traverse just started really building into November. 26% of our sales in November were the 2013. So we see sales of that new model picking up nicely. The dealers just love the new product. So that percent of total will continue to grow. When you look at our retail sales year-over-year, Traverse sales were about flat, and that's not totally surprising. Most of the fleet companies are actually waiting for the new one because of the improved residual, and so that'll start to pick up, particularly as we get into the first quarter of next year. And Malibu, as Kurt mentioned, Malibu had good month-on-month increases. Kurt noted just over 6% in total. Month-over-month was actually almost 9% at retail. So again, as we get the mix right, Turbos are just starting to land now. The month-over-month performance on the all-new Malibu is doing well, too. So we expect that to continue as we get into December and the rest of 2013.

Rod Lache - Deutsche Bank AG, Research Division

Okay, and the ATS availability, is that now fully available or are you still being affected by production constraints?

Chase Hawkins

Rod, it's Chase Hawkins here from Cadillac. We're flowing ATS really well now. We've got the 2.5 in field along with the 3.6. The hot car for us, obviously, that we're looking to do a significant proportion of our volume on is the 2-liter Turbo. That, today, accounts for about 1/3 of the total inventory mix out there. But we don't have any issues right now on ATS as it relates to inventory flow or constraints.

Operator

Our next question coming from the line of Brian Johnson with Barclays.

Brian Arthur Johnson - Barclays Capital, Research Division

Since we've kind of beaten up the pickup trucks, I want to kind of turn the focus to the story on cars and crossovers. Can you give us a sense in some of the key models that are growing, what the -- a couple things, what the retail share is versus -- or the fleet share, either one -- versus what it was for the prior models if there was one? And then also where pricing is and maybe specifically on the Cruze, the Sonic and -- well, let's just focus on those 2, the small cars.

Don Johnson

Okay, yes, Brian, again, Don Johnson. Cruze is running fleet, retail fleets about 24%, which is certainly lower than where the Cobalt ran. When you look at ATPs, Cruze is the top or with the top 2 in ATPs and is the second lowest. Basically, the 2 vehicles are tied having the lowest incentives in the segment. And then it's been pretty consistent throughout the year. So with Cruze continuing to grow, I think, we've got a good mix between fleet and retail. And I think we're being again very disciplined on holding our pricing and as well watching our incentives. Sonic, you had also asked about, Sonic's running about 16% fleet, which again would be below where the Aveo was, which was the vehicle that it replaced. Sonic, again, has sort of flirted with #1 in the segment, and last month, it did fall to #2 as the #1 competitor got much more aggressive with incentives. Sonic continues to have, again, the second-highest ATP in the segment and the second lowest incentives in the segment. So very similar story to what we're seeing with Cruze.

Brian Arthur Johnson - Barclays Capital, Research Division

I should have asked the Malibu as well.

Don Johnson

Yes. Malibu, the fleet penetration is a little bit lower than it has been historically, certainly as we've come out with the new model. ATPs right now are about $3,000 a unit above the model that it replaced. So again consistent with what we've done with all of our new launches. We've taken ATP up, we're taking incentives down, and we're moderating our daily rental and fleet penetration. Again, it's not that we're walking away from daily rental at all, we still firmly believe that getting people into those vehicles is very good to build the brand, to gain that awareness and opinion. But clearly, it's a matter of balancing the volume that we put in with what we need to do in the retail market and protect residuals.

Brian Arthur Johnson - Barclays Capital, Research Division

Yes, just a quick -- okay, great.

Kurt McNeil

So Brian, all those products you mentioned, Sonic, Cruze, Malibu, ATPs, all $4,000 more than the vehicles they replaced, incentive spend, if not the lowest, one of the lowest in the segment and all with pretty respectable share gains.

Brian Arthur Johnson - Barclays Capital, Research Division

Which gets to the question when you kind of put together your marketing plans and particularly how is your department measured as you kind of move to perhaps some sort of global Chevy, are you measured on volume or do you have kind of a contribution margin that forces you to think about the fleet retail mix and the ATPs more explicitly than just it's a nice-to-have it but let's move the metal?

Kurt McNeil

Yes.

Brian Arthur Johnson - Barclays Capital, Research Division

So are you measured in marketing on your contribution margin?

Alan Batey

Yes, this is Alan Batey. Look, to be really frank with you, what we're looking to do is, obviously, to grow our sales but to build strong brand equity in our vehicles with great resale values and really look at this marketing mix as a full 4P Strategy. Price is a very important part of it, but price is about offering great value, not the lowest prices in the market because our product, frankly, is too good. We don't need to be there. So what you're seeing is a result of a very disciplined, very deliberate approach, and I think it's only going to get better as we continue to grow our opinion in consideration.

Operator

Our next question coming from the line of Chris Ceraso with Crédit Suisse.

Christopher J. Ceraso - Crédit Suisse AG, Research Division

I do want to come back to the pickup truck discussion for a minute. Can you give us the percentage of your inventory in full-size pickups, let's say, heading into November? What percentage of those were still 2012 models versus 2013? And where did that stand at the end of the month?

Kurt McNeil

I'm looking here, Chris. This is 70% -- it's probably about 76% 2013s. That's at the end of the month. I don't have the data point at the beginning of the month. But...

Christopher J. Ceraso - Crédit Suisse AG, Research Division

Okay. So presumably you were pretty high already on the 2013s, so when you saw the competitors hike their incentives to clear out the 2012s, you decided not to move. I'm just -- you're already at relatively high stock levels. I'm wondering why you didn't make some move to keep the units going, and now you face deeper cuts in production.

Alan Batey

Yes, this is Alan Batey again. We saw, as I mentioned, we saw this very early in the month. We do believe that you're going to see this now move across as people do start to sell down their '12s. But this is a real test for us, and it really was a test about whether we really were going to remain disciplined and believe in what we've been telling you, which is that we will build equity in our vehicles with a very disciplined approach. And so, yes, we definitely gave up some sales, and we gave up some share in the month. But what really encourages us is the fact that we still had the best sales since 2007 and that we go into December now in a very, very strong position. So we think our plan is working, and it really was -- if we didn't have the lowest incentive spend as a percent of ATP, and if we didn't have the highest ATP, then I would be really concerned, but we do. So it was a very conscious decision that we made, and we think it's the right decision.

Kurt McNeil

And, Chris, well, this is Kurt again. We don't want to give you the impression that we're going to be making some significant production changes. I mean, we've been transparent all along saying that our full-size pickup inventory was going to be in that 200,000 to 220,000 unit range, and we just see it's going to be potentially on the high end of that. It's hard to call because we expect to do a lot of business as the industry will in the month of December. So it's hard to call. We're just letting you know, for the sake of transparency, it's going to be on the high end of that range. That's all.

Christopher J. Ceraso - Crédit Suisse AG, Research Division

Okay, that makes sense, and then just one quick follow-up on the ATS. Do you have any numbers on how many ATS buyers are trading in a CTS versus other vehicles?

Chase Hawkins

Yes, this is Chase Hawkins again. So I think ATS, if we look at the data, we're seeing approximately 20% CTS trade right now on ATS. What's interesting for us though is that we're seeing about 50% conquest on the car, and it's primarily Mercedes and BMW. So outside of GM, the individual marks that we've targeted with ATS were hitting the spot.

Operator

The following question will conclude the analyst portion. Following this question, we will proceed with the media portion of the question-and-answer session. [Operator Instructions] The final analyst question comes from the line of Colin Langan with UBS.

Colin Langan - UBS Investment Bank, Research Division

Any color on the number of vehicles you think that were destroyed in Sandy that will need to be replaced over the next 2 quarters? And I just want to confirm, the boost this month you said was 400,000 to the SAAR?

Kurt McNeil

Yes, on the second point, Colin, and we think that it's going to be on the low end of what's been published. As we've gotten into the data, looking at, like I said, a Katrina example, we didn't have the severity of a Katrina, and it wasn't as focused on specific states and markets. So right now we're in the 50,000 to 100,000 unit range, but we're still looking at insurance claims, et cetera, to try and get some detail around that.

Colin Langan - UBS Investment Bank, Research Division

So 50,000 to 100,000 would be the total vehicles that need to be replaced?

Kurt McNeil

That's what we're calling at this point. But once again, as that comes back similar to what we saw in Katrina, we're already seeing it, and it varies state-by-state. So at New York, Pennsylvania, states that weren't as heavily impacted, showing signs of recovery faster. But New Jersey, Maryland, Delaware that were a little harder hit, we'll start to see that in like that December to February window and we will see a positive uptick throughout 2013.

Colin Langan - UBS Investment Bank, Research Division

Okay, and any color on the retail SAAR this month and the cadence of sales through the month? Any color on either of those?

Kurt McNeil

Yes, retail right now, 13.2 to 13.4, and I'm not aware nor did I see any unusual behavior throughout the month.

Colin Langan - UBS Investment Bank, Research Division

So the sales pace was about consistent through the month?

Kurt McNeil

Yes.

Operator

Our next question coming from the line of Tom Krisher with Associated Press.

Tom Krisher

I was wondering what you thought of the Malibu sales were up only slightly even though the new model was out. And I was seeing some reports about there might be a refresh on that coming. Are you disappointed in that, or is that because of some not getting their engine selection better. Is there some reason for that?

Don Johnson

Tom, it's Don Johnson with Chevrolet. As I mentioned, actually month-over-month, almost 9% up on Malibu. So we're pleased with the pace that we're seeing in the sales increase. When you look at design changes, we continually evolve our products. You've seen that with a number of our products in the last few years. So I don't think that, that should be unexpected. But, really, I'm not going to make any more comments on any of our future product programs. But, in general, you've seen based on our historical behavior some of that.

Tom Krisher

Okay, if I look -- I might be reading it wrong, but I've got it down over last November minus 0.4%. Are you talking about retail?

Don Johnson

Versus last November, we were essentially flat in total. Retail was up 4% versus last November. I think importantly, as you look at the new model coming in, we've been looking at month-over-month gains, particularly with a relatively low season in November and we saw retail up 8.5% in November. We're starting to get our inventory in line. The Turbos are starting to land. So everything is pointing in the right direction.

Operator

Our next question coming from the line of Todd Lassa with Automobile Magazine.

Todd Lassa

Looking at the Chevy Volt sales was up versus last year, but I understand that it was roughly half of October sales. I wonder if you have an explanation for that. I wonder if you're seeing that, that car might be affected by weather in terms of its sales.

Don Johnson

Yes, Todd, it's Don with Chevrolet again. In fact, anything but. I was out in California last week and the dealers out there are just clamoring for more. We had a few record months in a row, as you may recall, and really that drove our stock down really, really low. We were down about 8 days' supply at the end of last month. We've just started to build that up in California. We've just got it up to 23 days' supply. In fact, the dealers are -- they've got sold orders. Customers are waiting for them to come in. It's a great story. As we rebuild inventory, we fully expect to get up to that same sales level that we've been seeing.

Kurt McNeil

Todd, this is Kurt. I'd be remiss not to mention that Volt drivers hit their 100 million-mile mark on pure electric driving. And when we equate that to fuel savings, that's over 5 million gallons of fuel that were saved because of that driving. So just a nice fun fact on Volt.

Todd Lassa

So just to clarify, you're saying that versus October, with the lower sales versus October that, that was mainly an inventory shortage?

Don Johnson

Exactly.

Todd Lassa

And also I'm sorry if I missed it, but did you give the days supply of the pickup trucks, what you got at this point?

Kurt McNeil

Yes, it's in the release, 139 days' supply.

Operator

Our next question coming from the line of Jeff Bennett with the Wall Street Journal.

Jeff Bennett

I just wanted to get some more clarification on the overall inventory you said may be in jeopardy. Can you give a little more color on that? Is it expected to come in much higher?

Kurt McNeil

I think previously, we gave you a range of 660,000 to 670,000, Jeff, and it's going to be above that, best we can tell.

Jeff Bennett

Do you have any idea of how much?

Kurt McNeil

No, because obviously, we're going to continue to be aggressive in December. We're going to tweak our production schedules where we have to. So it's hard to say. I'm just trying to be transparent and let you know it's going to be higher than that.

Jeff Bennett

And I'm just wondering, too, on that tweaking, are you looking at like slowdowns? And have you made any decisions yet or when would you might be making those steps?

Alan Batey

Yes, this is Alan Batey. Obviously, all these things, Jeff, are an ongoing process. There's not a moment in time when you make all of these calls. As I said, we consciously let it float up a little bit because of the liquidating that most of our competitors were doing in the market, and you've got the facts that show that. And we're going into a very big seasonal month where retail sales will be very strong, and it's also a low production month. So what we're talking about here, we'll go up a little bit, we'll come down a little bit, but we are absolutely in line with our long-term plan and the one we've always communicated to you, which is to keep a very balanced view and be very disciplined in the marketplace.

Jeff Bennett

And just lastly, since you didn't really change much from the 2012 to the 2013 models, wouldn't it do you better to kind of tweak the incentives a little bit more just to continue to move those units rather than cut production?

Alan Batey

Again, what we saw in the marketplace in November, we felt they were extreme and the data bears that out. We came off of a very, very strong October, and we expect we'll pick it up again in December. So this is a 1-month adjustment, and nothing's going to change on a longer-term basis. Mark Reuss is here. He's got something he'd like to add.

Mark L. Reuss

Jeff, this is Mark Reuss. We found that adjusting incentives on a short-term basis to our competition is highly ineffective as well because the dealers can't get behind it fast enough to make an impact. So what you don't want to do is flood confusion into the market as well. So all those things I think are really important things to say at the end of the day on whether we adjust to those or not. We take into account that data for the next round here, but we're trying to run this on a longer-term strategic basis than just matching people in the market on a short-term basis every time someone moves. So, hopefully, that helps a little bit, too.

Operator

Our next question coming from the line of Tim Higgins with Bloomberg.

Tim Higgins

Kurt, I'm trying not to be dense here, but I'm looking for a little bit of clarification on what you're saying regarding the pickup inventory. The goal, are you saying that you expect the inventory to exceed 220,000 at the year end, or that you expect it to be within the 220,000 range just towards the high end of it?

Kurt McNeil

Tim, we had previously given a range of 200,000 to 220,000. And once again, for the sake of being transparent, we don't know exactly where it ends up because there's a lot of business that transpires in December. We can't -- to Mark and Alan's points, we don't control what our competitors are going to do. From an incentive standpoint, we're trying to stay disciplined. But the best we can tell right now, we're going to be in the high end of that 220,000 and might go a little bit above that, but not significantly above that. So...

Operator

Our next question coming from the line of Melissa Burden with Detroit News.

Melissa Burden

I had a couple. Can you give us the overall Volt days supply since you had given for California? And with that, you mentioned that it was an inventory issue. Was production down for a while in November, or could you give a little bit more color for that?

Don Johnson

Yes, it's Don Johnson again with Chevrolet. We have built up our national days' supply really just in the last week to about 60 days' supply. So I think we're now at the ideal. California is still below that at 23, and a number of other states obviously, to come out at that average, are below it. So we're just now at a point where we think the inventory in many parts of the country is where it needs to be. California is still lagging. And, yes, as we prepared Hamtramck for the new Impala, we had to take some production downtime. So that did impact our ability to supply the market. Plus, quite frankly, sales in the last 2 months were a little bit more robust than we had originally anticipated. So both record sales, as well as the downtime we had to take contributed to the shortage, but we're on our path back now.

Melissa Burden

Okay. And then just to clarify that again, so you believe it was more of an inventory issue and not maybe some sales going to competitors such as the C-Max?

Don Johnson

No, it was absolutely inventory issue. I mean, the other thing that underscores just the word-of-mouth that's getting out there from Volt customers, as you probably know, consumer reports again reported Volt had the top level of customer satisfaction. So the good thing with Volt is that the advocates are starting to have an impact on the broader consumer population, and it's resulting in stronger sales.

Melissa Burden

Okay, and then, may I ask as well, with truck production at the truck plants, I know previously, the company had given a figure that, overall, they expected there would be 29 weeks, I believe, of downtime for the year in preparation for the new trucks. Can you give us an idea of during November kind of where that start, or in other words, how many down weeks there would be at the truck plants in November -- I'm sorry, or December?

Kurt McNeil

Yes, Melissa. We have -- I know I haven't, we haven't given any of that information out, and we don't give guidance on production. So I'm not sure where you got that tidbit, but I can't confirm nor deny it.

Operator

Our next question coming from the line of Mike Colias with Automotive News.

Mike Colias

Just on the year-end inventory, are the pickups the only factor in potentially going over that target, or are there other models that are carrying higher inventory than you guys anticipated at this point?

Kurt McNeil

Yes, Mike, it depends, I guess, is the answer. The devil is in the details. We are, like we said, going to be on the high end of our pickup inventory. We're going to probably exceed our total inventory range. But the devil's in the details. So it's going to depend on the business we do in December. We think we've got a great marketing play. We are going to be competitive. So where we really end up, it's really hard to call exactly this time of year because of how much business we do in December.

Mike Colias

Okay, well, yes, that's why I asked because you said pickups could potentially fall in the range still, but you made it sound like the overall range, you're likely to go above. So just can you say any other name plates or any other models that you think you're heavy on?

Kurt McNeil

Yes, I wouldn't be able to, Mike. I don't know.

Mike Colias

Okay. And on Volt, any color on how heavily weighted California is now versus, say, a year ago in terms of just the percentage of sales nationally?

Don Johnson

Yes, it's Don Johnson with Chevrolet again. Yes, we're still running about 34%. I would say a year ago, we were probably in the low 30s, high 20s. So it has certainly increased as a percent of the national take, but maybe only by 4 or 5 percentage points.

Operator

Thank you. That is all the time we have for today. Mr. Cain, I will now turn the call back to you. Please continue with your presentation or closing remarks.

Jim Cain

Yes, thank you for joining us, everybody. If you have any follow-up questions, you can reach me in the office this afternoon by phone or e-mail. Thank you.

Operator

Ladies and gentlemen, that does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines. Have a great day.

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