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Call End: 11:44

General Motors Company (NYSE:GM)

2012 Sales Call

March 1, 2012 11:00 a.m. ET

Executives

Jim Cain – Communications

Don Johnson – Vice President of U.S. Sales

Alan Batey - Chevrolet Vice President

Tony DiSalle - Vice President for Buick and GMC Marketing

Kurt McNeil - U.S. Sales and Service Vice President, Cadillac

Sue Yingzi Su - Senior Economist

Analysts

Brian Johnson - Barclays Capital

Adam Jonas - Morgan Stanley

Chris Ceraso - Credit Suisse

John Murphy - Bank of America Merrill Lynch

Dan Galves - Deutsche Bank

Colin Langan - UBS

Patrick Archambault - Goldman Sachs

Media

Tom Krisher - Associated Press

Ben Klayman - Reuters

Chrissie Thompson - Detroit Free Press

Tim Higgins - Bloomberg News

Mike Colias - Automotive News

Melissa Burden - The Detroit News

Robert Schoenberger - The Plain Dealer

Operator

Ladies and gentlemen, thank you for standing by and welcome to the February 2012 General Motors U.S. Sales Conference Call. (Operator instructions) As a reminder, this conference is being recorded Thursday, March 1, 2012.

I would now like to turn the conference over to Jim Cain, GM Communication. Please go ahead, sir.

Jim Cain

Morning. Thank you for joining us, everybody. This is the General Motors February sales call. We have leading our discussion today Do Johnson, our U.S. Vice President of Sales Operations.

Before we begin I would just ask everybody to recognize that this conversation is covered by our standard disclosure and forward-looking statements, which you can read in our press release. We’ll have discussion followed by Q&A and I’d like to turn the floor over to Don Johnson.

Don Johnson

Thanks, Jim. Good morning, everybody. Thanks for joining us. As you’ve no doubt read by now, we reported total sales for the month of 209,306 units and that’s just over 1% higher than February of 2011, which beat most expectations based on what we’ve been seeing in the last month.

As we told you last month on the call, our sales were exceptionally strong in January and February of 2011. So, this month’s strong performance is once again I think a real testament to our steady progress and, importantly, to our focus plan.

Now you dig into the numbers you’re going to immediately see that sales of our newest fuel efficient cars and crossovers were very strong in February. An example, we had our best month so far for the Chevrolet Sonic. Sales for the Sonic were an even 7,900 vehicles. And the Chevrolet Cruze just delivered its sixth month of sales exceeding 20,000 units and that also makes February the car’s sixth consecutive month of higher year-over-year sales.

In addition, the just-launched Buick Verano is really getting traction and this month the Verano had sales of almost 17,000 units. And then our compact crossovers, which include the Chevrolet Equinox and the GMC Terrain, we’re up a combined 25%.

Now as we look at the numbers this month, I’m particularly encouraged that its great products and improving economic fundamentals that are really driving our business. When we look at the incentive piece of our business, our spending in February was actually down, both on a year-over-year as well as a month-over-month basis. When you do express that as a percentage of average transaction prices, GM’s year-over-year spending was down three and a half percentage points to 9.5%, according to J.D. Power PN estimates, and we were down about a half a point from January.

So let's talk a little bit about the industry outlook. For much of 2011, the auto industry was a bright spot for the broader economy, and we think that that continues to be the case. February light vehicle sales will be more than 1.1 million units, which compares with sales of about 914,000 units in January.

Now, right now, we're estimating that the light vehicle SAAR will also be up and it could grow to between 14.5 million to 14.9 million, and that compares to about 14.1 million in January. Now, we need to keep in mind that February is still a relatively low seasonal month, so a small change in volume can really drive the SAAR. But that said, this could be the highest monthly SAAR since 2008.

Now, there are a number of factors that are helping release this pent-up demand, and they include stronger employment, good credit availability, and both of those are leading to improving consumer sentiment. And as you've all seen, the unemployment rate is the lowest it has been in three years, and consumer sentiment in February was at the highest level in the last 12 months, according to the University of Michigan.

But perhaps the most encouraging sign is that home builders are becoming more optimistic, according to a recent survey by the National Association of Home Builders. And we're optimistic, too. Housing starts and new home sales were recently revised upward, and that suggests that the end of housing price declines may finally occur this year.

And we can start to see clear evidence of this stronger sentiment and optimism in our commercial fleet sales. In February, our overall fleet sales were up 20%, but this was primarily driven by a 35% increase in sales to commercial customers. In particular, commercial customers are driving stronger sales of the Chevrolet Silverado and the GMC Sierra heavy duty trucks, which were up 28% and 20%, respectively. Government sales, meanwhile, were up 16%, and rental sales were up 15%. And when you look at our overall fleet mix for the month, it was around 25%, and that's right in line with what our full-year plan is.

Now, when we look at our brands and our other vehicle lines, again, you'll see the success of our fuel-efficient vehicles really does tell the story. February was paced by Chevrolet, especially Chevrolet passenger cars, which were up 13% year-over-year. Our dealers delivered 20,427 Cruzes, that's up 10%, and at the same time, we delivered 7,900 Sonics, and that's up almost 200% over the model that the Sonic replaced. And we also delivered 1,023 Volts in February.

Now, when you add the almost 1,700 Buick Veranos to the mix, our total GM small and compact car sales increased 43% year-over-year. And we'll keep Verano's momentum going in March with the launch of our national media campaign which includes a full court press during the NCAA Basketball Tournament.

Now some of the other strong performances that I would draw your attention to are the Chevrolet Malibu which is up 5%, the Chevrolet Camaro which is up 11% and the Buick LaCrosse which continues it strong trend up 21%. And the popularity of the LaCrosse is due in no small measure to the success of our 36-mile-per-gallon eAssist powertrain. So far this year about one in four LaCrosses have been sold with eAssist.

Now in the truck market total GM truck sales were up 4% year-over-year and this figure includes all of our body-on-frame vehicles, with the Chevrolet Silverado, Avalanche, Suburban, Colorado and Express all posting higher sales.

As we look further into 2012, we expect to see the full-size pick-up market to follow its usual seasonal patterns with stronger sales in the second half of the year. In the first half of last year, for example, full-size pickups represented 10.5% of the industry. And that's exactly where the segment was in January and February of this year. As you may recall, we ended 2011 with pickups representing an 11.6% share of the industry and we expect again that seasonal difference to play out and end up in that range again this year.

Now, having said that, there has been a lot of attention paid to the recent increases in gasoline prices, and rightly so. No one likes to pay more for fuel and everyone likes to go further on a gallon of gas. The question that I know everybody's asking is how will higher fuel prices impact the industry and General Motors in 2012?

Well, basically, what we see in terms of pent-up demand and, importantly, the strength of the economy, we do not believe that short-term fluctuations in pump prices will curtail industry growth this year. That's because American consumers and the overall economy are in much better shape than they were a year ago.

Now, if fuel prices do impact the mix of vehicles that people choose to buy, we'll be ready because we are dramatically expanding our portfolio of very high fuel-economy vehicles and they're all very popular with consumers. You know, consider this fact; just three short year's ago about 16% of the vehicles that we sold achieved at least 30 miles per gallon on the highway. Contrast that today where that number is closer to 40% and we have more new fuel-economy leaders on the way, including the Chevrolet Spark and the Buick Encore. We believe that this puts us in a very strong competitive position regardless of what the market environment is.

So, that's it for my summary. Let's turn now to the Q&A portion of the call. Joining us today are Chevrolet Vice President, Alan Batey, Tony DiSalle, Vice President for Buick/GMC Marketing, Cadillac Vice President, Kurt McNeil., as well as our Senior Economist, Sue Yingzi Su.

Okay. Let's open it up for questions please, operator.

Question-and-Answer Session

Operator

Thank you. Ladies and gentlemen, we will now proceed with the analyst portion of the question-and-answer session. (Operator instructions) And our first question comes from the line of Brian Johnson with Barclays Capital. Go ahead.

Brian Johnson - Barclays Capital

Yes, good morning. A question both for the sales executives and for Sue because they're related. Can you give us some sense of the year-over-year increase for you. And then if you have industry numbers for the North and Midwest and then the Northeast that it varies with unusually warm weather where the seasonal factors might have assumed some snowstorms?

And then, for Sue, what impact when you think about the seasonal factors the BEA puts out, do you think the weather had? What impact do you think the Japanese rebound might have had on February and how do you therefore, kind of, see the rest of the quarter, really, rest of the first half playing out versus typical seasonal pattern?

Don Johnson

Hey, Brian, it's Don. I'm going to just answer the question about the seasonality and then I'm going to turn it over to the (inaudible) to talk about their view on any regionality. But in general, when you look at the SAAR in January and February, I think it has surprised many of for a couple of reasons.

I think the underlying economy, importantly, is stronger than anticipated. Clearly, there was some, I would call it, some carryover clean-up from '11 that may have happened from some manufacturers early in the year. And clearly there is a bit of a restocking going on with our Japanese competitors.

And the other thing you may have seen is in the fleet market a number of competitors are making some daily rental commitments from 2011. So that is driving the fleet a little bit higher than I think it would normally be.

But I would still come back to suggest that the underlying economy is probably the biggest factor, but at the same time from our perspective, we are going to be careful not to overreact in terms of our forecast. We are not revising our forecast at this time.

Clearly, our '12 looks like it's going to come in at the high end of the range that we provided, but we are going to wait until we see March because March is a much higher season so that we can look at the whole first quarter before we make any change or assess our industry forecast.

Brian Johnson - Barclays Capital

And in terms of that, was there an unusually high year-over-year increase in the North versus the South?

Alan Batey

This is Alan Batey, Brian, its Chevrolet. Nothing happened regionally which was strange or different. We had a great month and all of our regions came in pretty close to what we expect them to be.

Brian Johnson - Barclays Capital

Okay. So there wasn't an unusual boost in the North from people coming in?

Alan Batey

(inaudible)

Brian Johnson - Barclays Capital

Okay. Thanks.

Don Johnson

Okay. Thanks, Brian.

Operator

And our next question comes from the line of Adam Jonas with Morgan Stanley. Please proceed with your question.

Adam Jonas - Morgan Stanley

Thanks very much, guys. A couple questions on the new Malibu, old Malibu changeover. Can you give us a split of inventory on dealer lots between the old and the new? We're hearing from some dealers that they've got a lot of the twelve sitting on the lot and they could use a little help moving those out, as they're already getting invoices for the brand new one with the Eco that's looking pretty popular.

Alan Batey

Yeah, this is Alan Batey. Let me just say that Malibu had a really, really strong month. I mean, we were just a couple of units under 20,000 units for the month. So we had a very strong month. As for the new one, we only just got inventory arriving as we speak. So, we had 200 or 300 sales last month. But all of our sales came from the current models.

So, no, we're not seeing that at all. And I'm actually surprised by your comment, because our inventory levels are not high at all. We're currently sitting on a 90-day supply, and that's frankly where we want to sit with that type of vehicle. So, I don't see anything strange happening.

Adam Jonas - Morgan Stanley

But that's a 90-day supply of what's predominately the old model.

Alan Batey

Right.

Adam Jonas - Morgan Stanley

Okay. Fine. Next question on V6 versus four-cylinder engines. Given the rise in fuel prices, any kind of change in focus to get more? For example, four-cylinder Equinoxes on dealer lots instead of the six cylinders? Again we're hearing the six cylinder have far less demand, incrementally at least, than the four?

Don Johnson

Yeah. And, overall, when you look at our total portfolio, we're right at about 40% for four cylinders. There's definitely good demand for the four cylinder in both the Chevrolet Equinox and the GMC Terrain because they're very high fuel economy getting 32 on the highway. So, yeah, we're definitely seeing that demand for four cylinders.

Adam Jonas - Morgan Stanley

Great. And, finally, any update on credit quality in the month? I know it's been running so strong, it's almost unbelievable. But, just any change to the recent seasonally adjusted trends in credit quality that you're seeing?

Don Johnson

No, everything that we've seen is actually pretty consistent with what we've seen for the last couple of months, still staying strong.

Adam Jonas - Morgan Stanley

Okay. Great. Thanks guys.

Operator

And our next question comes from the line of Chris Ceraso with Credit Suisse. Please go ahead.

Chris Ceraso - Credit Suisse

Thanks. Good morning. A couple of questions. First off on the Camaro. I noticed that was pretty strong relative to some of the other vehicles. And I'm just wondering if that's at all a read across on the unseasonably warm weather?

Alan Batey

Yeah, I don't really know how to answer that. You know Camaro continues to be very, very popular. The Camaro sales were up year-over-year about 11%, so that just continues. But, of course, we have the convertible available and the hard top. Obviously, convertibles not a great season in the northeast region, but obviously in the west and in the south, you know, sales have been robust. So, yeah, Camaro is doing really, really well. But I didn't see anything strange happening in the month, as I said it was up 11%. But the car just continues to build momentum.

Chris Ceraso - Credit Suisse

Okay. And then, just a question on the trucks. Not to nitpick, but there was a comment in the release that very strong demand for the heavy duties is a good read for strength in the economy. But, if I remember right, and maybe I don't, weren't you not available with diesels at this time last year for the heavy duties? Is that right?

Don Johnson

No we had them last year this time. There might be a slight improvement in supply this year over last year, I'll have to go look. But no we had the diesel last year.

Chris Ceraso - Credit Suisse

Okay. When did you, just remind me, when did the heavy duties launch? And, there was a window there where you didn't have diesel availability. When was that? Just remind me.

Don Johnson

I'm going to have to go back and get the date for you, Chris. Let me make sure. I want to make sure that I'm accurate on it, I don't want to just go by my memory.

Chris Ceraso - Credit Suisse

Okay. Thanks.

Operator

And our next question comes from the line of John Murphy with Bank of America Merrill Lynch. Please go ahead.

John Murphy - Bank of America Merrill Lynch

Good morning. Just, first question on used car pricing. I'm just curious how much you think the strength in used car pricing and really the equity that the consumer is trading in is helping drive sales and really the conversion rates of ups in dealerships?

Don Johnson

I think that definitely is having an impact. I mean we've talked about this before, but when you look at the equity that people have in their current vehicles, when you look at the improved credit availability and the low cost of financing right now, absolutely that's one of the contributing factors that makes it a great time to buy a car right now.

John Murphy - Bank of America Merrill Lynch

And, Don, would that be the kind of thing that you would consider running a big ad campaign on and saying hey you know, you've got a thousand dollars more equity in your car than you think you do. It's a great time to buy a vehicle. Why don't you come into one of our dealers and take advantage of that?

Don Johnson

That's a great idea.

John Murphy - Bank of America Merrill Lynch

Okay. Maybe a second question just on advertising. Obviously you pressed pretty hard on the Super Bowl. I was just curious what kind of results you think you got from that advertising? And as we look forward at March Madness if there might be another opportunity to really get out there and advertise the new vehicles and maybe push sales further? I'm just trying to understand what kind of bang for buck you think you got on the Super Bowl and if there might be an incremental push during March Madness?

Don Johnson

Well, there's no doubt on the Super Bowl we had a great presence and created a lot of chatter. We don't know the actual numbers yet that show what the direct impact was, but we certainly see that as a good investment. As I mentioned in my remarks, we are going to be in in a big way in NCAA, and I'll let Tony talk a little bit about that.

Tony DiSalle

Yes. March Madness is very important to us at Buick. We are going to have a lot of weight on Verano and this is a key time for us to launch Verano in the marketplace. We've taken the learnings from Chevrolet's Super Bowl experience and we continue to learn from what we do across the brands and plow them into future activations like we're doing now.

John Murphy - Bank of America Merrill Lynch

Okay. And then, just finally. Fire away, sorry.

Alan Batey

I was just going to say, this is Alan Batey at Chevrolet, yeah, Super Bowl was fantastic for us. What's great about Super Bowl now is it's not a one-day event. The build up to it, the amount of awareness and interest you can create for your ads is really tremendous.

So it's almost a three to four week event leading up to it. Of course, all the digital measurements that we can now get and all the interest that people go on and download and share the ads has obviously been very, very powerful.

And Sonic was, you know, one of the products that we really focused on in Super Bowl and it was the first time in fact that we'd done any TV advertising at all for the model. It's definitely really helped from the awareness perspective with a new nameplate. And our sales, as you know for the month, were the best yet at nearly 8,000 units.

So, yeah, I think Super Bowl was a big, big win for Chevrolet.

John Murphy - Bank of America/Merrill Lynch

And then just lastly, and I understand the conservatives in not changing your forecast right now, but we are running, you know, for the first two months of the year stronger than what you're looking for, last year finished pretty strong.

I'm just curious, are there any factors that would lead you to believe that we'd see a sales decline from what we've seen from the past few months? Or is this really just trying to remain conservative on your planning assumptions so you run the business in a balanced way and don't get ahead of yourselves?

I'm just trying to understand if there's any real reason that you'd think that we'd see a decline in sale from here?

Don Johnson

I think it's a little of both. I mean, I think we want to be prudent obviously in how we run our business. But I do think there are a couple things in the first two months that we need to see if the trends are there. One of them is the fleet market and the sales-to-date of rental companies from some of the competitors.

And the other is the January and February low seasonals. When you have a low seasonal, you know, it's like a lever. You got to be careful because a small change at one end of it can suggest a very large change in the SAAR.

While that may be part of our conservatism, it's a reality too when you look at low seasons you always have to be careful with them. I don't mean to sound pessimistic, because we are really happy with January and February.

John Murphy - Bank of America Merrill Lynch

Okay. That's very helpful. Thank you very much.

Operator

And our next question comes from the line of Rod Lache with Deutsche Bank. Please go ahead.

Dan Galves - Deutsche Bank

Hi, good morning. This is Dan Galves in for Rod. How you doing?

Don Johnson

Hi, Dan.

Dan Galves - Deutsche Bank

Hey. I just wanted to dig in a little bit more on the comment on the HD pickups. First of all, just to clarify, does that include all the three-quarter and one-ton trucks or is that just the HD series?

Don Johnson

That's just the HD series.

Dan Galves - Deutsche Bank

Okay, gotcha. And do you have any way to tell, like, if the overall industry was really strong in those types of trucks? And is there and is there any kind of an analysis of, you know, the end users of those vehicles that you could give us color on?

Don Johnson

Yeah, we won't have the industry number by segment until all the manufacturers are in, so that will take us a few days. But we can dig into that and give you some of those numbers. At the same time, you know, once we get into our own data a little bit deeper, separately, maybe we can give you some color on those customers.

Dan Galves - Deutsche Bank

Is that a premier of some pretty heavy, in terms of contractor, end use for those vehicles in agriculture? Is that kind of key end users?

Don Johnson

Yep, typically, it is. Typically, agriculture and contractors, oil fields.

Dan Galves - Deutsche Bank

Gotcha. And then just on the retail sales for the industry, you know, one of your competitors said that retail looks to be about 80% of the industry. I think it was probably close to 75% in January. So, looks to us like the retail SAAR could be up, you know, a million units or more. Would you agree with that?

Don Johnson

Probably the retail SAAR, our numbers would show retail SAAR up sort of 700,000 to 800,000, but in that range.

Dan Galves - Deutsche Bank

What do you show for January?

Don Johnson

We show January at about 11.5 retail light.

Dan Galves - Deutsche Bank

Okay. Gotcha. Okay. Thanks very much.

Operator

And our next question comes from the line of Colin Langan of UBS. Please go ahead.

Colin Langan - UBS

Can you provide some color on the truck growth? It looks like some of your peers did a bit better. I mean was it tough comps or were there some incentives out there in the truck segment this month?

Don Johnson

Yeah, I guess that's an interesting question because we did have a look at that. A couple of things happened. I think, first of all, we had a tougher comp because we were very strong in February last year. But the other thing is when you look at our incentives year-over-year, we were down sort of $800 to $900 a unit and even month-over-month we were down about $400 a unit, whereas the segment was, based on the data we get from J.D. Powers, the segment was actually flat month-over-month.

Colin Langan - UBS

Okay. So it sounds like some incentives. And you comment on the pace of sales through the month as well as the mix? I mean did we see it accelerate through the month end and did we see most of that from cars because of the gas prices?

Don Johnson

Yeah. At the end of the month it did accelerate. I think the participation by most manufacturers in President's Day promotions probably drove most of that. Ours seemed to have a little bit more legs as we ended the month. So, yeah, we saw some good strength throughout the month.

The mix we didn't see a big shift. You know, maybe a little bit more towards compact cars at the end of the month, but pretty steady throughout the month. As an example, we looked at the full-size pickups as a percent of industry was fairly steady through the month.

Colin Langan - UBS

Okay. Thank you very much.

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 Patrick Archambault. Please go ahead.

Patrick Archambault - Goldman Sachs

Yeah, thank you. Good morning.

Don Johnson

Morning.

Patrick Archambault - Goldman Sachs

I, you know, just wanted to have a follow-up on the full-size pickup demand. You know, in sort of the work that you've done, can you give us a sense of how much of those sales are somehow connected to the housing market?

And I don't know, maybe you've done some work on the correlation between trucks and housing, you know. Because clearly, I think at the beginning, that came up as potentially one of the sources of strength here. And just wondering if that could continue to be a source of strength in an environment where generally people expect mix to be kind of weak for this year.

Don Johnson

Yeah. That's a good question. We're seeing a fairly steady trend up until now where the primary commercial buyer of pickups has actually been the agriculture business, especially the smaller companies. Housing is still important, but it’s sort of agricultural. And then a lot of its trades but more renovation related, and then housing. So we do see some upside as the housing market comes back for the rest of the year, as we believe it will, to continue to drive full-size pickup sales.

You know, one of the things that we've also seen in the last, you know, couple of years is that the personal use buyer is becoming less and less a piece of the full-size pickup market. It's much more driven by commercial buyers. So, those commercial buyers have to buy trucks to run their business. So that's what gives us continued optimism and confidence in our outlook for the pickup segment as we go forward. Those folks need to buy them for work, the economy is strengthening, so we think that commercial pickup demand will continue to be released.

And the other thing that a lot of people don't talk about, not only the equity position, some of them may be in the current vehicles that was mentioned earlier. But, for those that are driving older vehicles, and don't forget the average age of the vehicle is like 10.8 years, new vehicles get a lot better fuel economy than the old vehicles. So insofar as gas prices are going up for many owners of older vehicles, we expect that will drive them to actually making new vehicle purchase decision.

Patrick Archambault - Goldman Sachs

Okay, great. Very helpful. And then, lastly, you know I know that you said at the beginning that you didn't believe that kind of an increase in gas prices was necessarily going to detract from, you know, the overall level of demand. But just clearly that comes down to sort of, you know, how big increases in gas prices are. Have you done any work to, you know, kind of gauge where people have, you know, kind of break point at which point they sort of freeze purchases because it does seem that you hit these break points. But they seem to change over time, obviously.

Don Johnson

Yeah. When we look back at history, and we have to be careful because history isn't always a good predictor of the future, but when we look back historically we see the phenomenon that you describe which is that there are break points.

What we see is if gasoline breaks through some, I'll call it a technical barrier, people may slow down or hesitate. But once it stabilizes, they come back into the market. The underlying strength of the economy and the market brings us back to a trend line. So, insofar as that happens, it's typically a short-term phenomenon, which is why we think over the long-term of the year, that won't negatively impact the industry.

The other thing that impacts people and influences their behavior is if prices are volatile. So if we're going to see gas prices stay where they are today, once they stabilize, we think the industry will continue on its current trend. Now, that doesn't take into account dramatic events that may take place or true shocks to the system. So that's the only caveat I would throw on that.

Patrick Archambault - Goldman Sachs

Okay. Yeah, it makes sense. Thank you very much.

Operator

And our next question comes from the line of Tom Krisher with Associated Press.

Tom Krisher - Associated Press

Hi, Don. What would it be like if you had the 2008 lineup today and you had had this gas price spike? What kind of shape would you have been in?

Don Johnson

Well, you're asking me to speculate here, Tom.

Tom Krisher - Associated Press

A little bit, yeah. But it's fun speculation.

Don Johnson

Specifically, I guess it's tough to say. But I can say that we wouldn't be in as good a shape as we're in today, simply put. You look at the 30 mile per gallon we talked about three years ago versus, you know, how many we have at 40 now. Clearly, we wouldn't be in as good a position. We're in a very enviable position now because of our car portfolio that's complementing our strong trucks.

Tom Krisher - Associated Press

Okay. And then you had mentioned, this is kind of a follow-up to Patrick's question, you mentioned that long-term gas prices, or short-term gas prices you didn't see have an impact, but there are predictions of $4.25 a gallon by the end of April and then stabilizing at that level and maybe sticking there for the rest of the year. If we hit well above $4.00 a gallon, do you see that as having any impact on the industry?

Don Johnson

Again, it's tough to say for sure, Tom. But I think if we got to those gas prices and then it stabilized, I think the industry would come back to trend. It’s the trend that we’re seeing now.

Tom Krisher - Associated Press

Okay. Thank you.

Operator

And our next question comes from the line of Ben Klayman with Reuters. Please go ahead.

Ben Klayman - Reuters

Yeah, hi, Don. I was just wondering, do the higher gas prices coupled with the rising age of vehicles on the road provide a more compelling business case for American consumers to purchase new cars?

Don Johnson

Yeah, I had mentioned that as part of an answer to Patrick's question, that I think it does. I think when consumers do the math of the savings they can get by buying a more fuel-efficient vehicle, compared to their old one, combined with the favorable financing rates that are out there, I think for many consumers, that will motivate them to buy a new vehicle.

Ben Klayman - Reuters

And then one follow-up. Maybe I missed it. Did I get the inventory on cars, and specifically Cruze and Sonic, and are you guys happy with that level?

Don Johnson

Yeah, I can give you the overall car inventory, which is, hang on, I've got divisional, so car inventory is 245,000 units.

Ben Klayman - Reuters

What does that work out to on a days supply?

Don Johnson

That's about a 70 days supply.

Ben Klayman - Reuters

And do you have the figures for Cruze and Sonic?

Don Johnson

I think I do.

Ben Klayman - Reuters

Thank you.

Don Johnson

Just let me find it. Cruze is 65 days supply, which is 53,000 units, and Sonic is 15,000 units, which is a 48 days supply.

Ben Klayman - Reuters

And are you--is that where you guys want those inventory levels to be?

Don Johnson

Yeah, I would say we're fairly comfortable with that right there.

Ben Klayman - Reuters

Okay. Thank you.

Operator

Our next question comes from the line of Chrissie Thompson with Detroit Free Press. Please go ahead.

Chrissie Thompson - Detroit Free Press

Hi, there. I'm wondering, first of all, if you can just catch me up to speed here. What is your full-year forecast? You've mentioned that you're not going to revise it down, but I'm not sure I caught what it actually is.

Don Johnson

We've said that we see a full year light duty vehicle forecast between 13.5 million and 14 million.

Chrissie Thompson - Detroit Free Press

Okay. And then, can you also give me an idea of, you mentioned the increase in commercial. As a percent of your total sales, what was commercial this month?

Don Johnson

Commercial vehicles as a percent of our total sales was 6.3%.

Chrissie Thompson - Detroit Free Press

Okay. And then lastly, I'm wondering if you could talk a little bit about, and maybe at least some of this might be tied to commercial, I don't know, but what do you think is going on with Express and Suburban? Those two have gains, I think you kind of (inaudible).

Don Johnson

Did you say the Express van and the Suburban?

Chrissie Thompson - Detroit Free Press

Yes.

Don Johnson

Certainly the van business is following the growth in the commercial business overall. We're seeing very, very strong demand for those vehicles from our commercial customers.

Chrissie Thompson - Detroit Free Press

Okay.

Don Johnson

Suburban is just a great utility vehicle.

Chrissie Thompson - Detroit Free Press

But your other utility vehicles didn't do so well.

Don Johnson

Yeah, I mean don't forget the Chevrolet brand is, you know, 67%-70% of our total volume. So when something takes off it's often the Chevrolet that will go first.

Chrissie Thompson - Detroit Free Press

Okay.

Operator

And our next question comes from the line of Tim Higgins with Bloomberg. Please go ahead.

Tim Higgins - Bloomberg News

Thanks. Good afternoon, gentlemen. Appreciate the time. I'm wondering if you can get me the days supply of the Volt and the breakdown of fleet retail mix on Volt last month and if you've got any kind of thoughts on when you might see a bump from the California spec version on sales.

Alan Batey

Yeah, this is Alan Batey. The total Volt sales last month were 1,023. Within that fleet was 37 units, so retail was 986. Including our demos that are out in the dealer network, our current grounded stock is 3,596 units and we are gonna start to build now the HOV lane vehicles for California, so we'll be filling that pipeline over then next month or two.

Tim Higgins - Bloomberg News

Okay. And you expect a big bump from that?

Alan Batey

I think it's going to be, yeah, very strong.

Tim Higgins - Bloomberg News

Thank you.

Operator

And our next question comes form the line of Mike Colias with Automotive News. Please go ahead.

Mike Colias - Automotive News

Yeah, thanks guys. Don, is it fair to say that the strength you guys saw in the small and compact cars for the month had more to do with the line up than rising gas prices? I didn't really hear you attribute that strength to the moving and fuel prices.

Don Johnson

Yeah, that and my comments were specifically couched that way. It is about the new products and the great products that are meeting the needs of the consumers better than they ever had in that segment for us.

Mike Colias - Automotive News

Okay. And a question for Alan on Sonic. I'm wondering what your fleet percentage on the Sonic was and then if you guys have a conquest number for Sonic.

Alan Batey

Yeah, I'll give you the split. Total Sonic was 7,900, fleet was 1,868, retail was 6032 and let me just flip through and get you the Conquest number is about 58%, 60% Conquest.

Mike Colias - Automotive News

And do you have an color on where those folks might be coming from or any geographic strength? I mean any commentary at all on that.

Alan Batey

Look, we're taking it from everywhere to be honest with you. We've got all the gain in this segment. So, yeah, we're seeing some Japanese business come our way and, yeah, the vehicle was very, very strong right now.

Mike Colias - Automotive News

Okay. Thanks, guys.

Operator

And our next question comes from the line of Melissa Burden with The Detroit News. Please go ahead.

Melissa Burden - The Detroit News

Hi, thank you for taking my question. A couple of quick questions. I was wondering if you guys might be able to provide a bit more color or, you know, kind of your thoughts on really what drove your 1% gain, especially when analysts, I think most analysts, had expected you to be down, you know, between 5% and 6%?

Don Johnson

Yeah. As I've said in my remarks, when you look at the across the board, but particularly the strength of the Chevrolet Car portfolio and the new vehicles that are ramping up, I mean Cruze continues to be a more and more important part of our portfolio. Sonic being new in the market and really 700 to 800 units, doing a great job. Verano is off to a super start.

But the other thing is, and I've talked about this in a number of calls, you have to look at the vehicles that you've had out there for a couple of years, as well. They continue to do well. The Buick LaCrosse up 21%, GMC Terrain and Chevrolet Equinox both up. So fairly, I think the strength of the broad based portfolio is what's helping us achieve these kinds of numbers.

Melissa Burden - The Detroit News

Okay. And, can you talk a little bit, also, about Cadillac? Just, really wasn't any mention of them and I noticed that they're down overall. But could you talk a little bit about that and kind of what your expectations might be for the rest of the year?

Kurt McNeil

Yeah, Melissa. It's Kurt McNeil. Thanks for your question. Yeah, I mean the year-over-year comparisons are real tough from our standpoint just because last February was the best February we had on record. And so it was a very strong month for us. Now fast forward to this year, we do not have a DTS or an STS, any longer.

We also took, as we've talked about on previous calls, our rental volume was down 81% this past month. So, we're continuing to take our rental down, it was only, rental was 3% of our total sales. So, that's what we've committed to. That's what we're going to continue to operate to.

And, you know, as we get further into the year obviously the whole thing changes for us as we introduce two brand new vehicles and a significant mid-cycle enhancement on a third. So, the immediate future is very bright. We're just in this period right now where we find ourselves in, so.

Melissa Burden - The Detroit News

Okay. Well thank you guys very much.

Don Johnson

Thanks, Melissa.

Operator

And the last question comes from the line of Robert Schoenberger with The Plain Dealer. Please go ahead.

Robert Schoenberger - The Plain Dealer

Hi, thank you. Looking at the Cruze numbers, do you have a breakdown of the Eco version versus the others? And was there any significant move in orders from the dealers, for more Ecos as gas prices went up or is there anything noticeable in that mix?

Don Johnson

Yeah. It's tough to attribute any short-term change to that, at this point. But our retail sales for Eco in February were about just over 16% of total. In January it was 15%. So you know it went up by one percentage point month-to-month. You know part of that could be fuel economy prices, but, you know, again, we need to look a bit of a longer trend to come to any firm conclusions in that regard.

Robert Schoenberger - The Plain Dealer

I think it was at launch the Eco was kind of targeted at high single digits so it's now trading in the mid doubles. Is there any, was that a surprise in any way or did that required any kind of shift in marketing on your side?

Don Johnson

No, I think it has reached its natural level and we're quite comfortable with where it is.

Robert Schoenberger - The Plain Dealer

Great. Thank you.

Operator

Mr. Cain, there are no further questions at this time. I will now turn the call back to you. Please continue with your presentation or closing remarks.

Jim Cain

Well, I'd like to thank everybody for joining the call today. Good discussion. If you have any follow-up questions, you can feel free to call or email this afternoon. Thank you and have a great day.

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 line.

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