5 Not-So-Hot Cars for February

DETROIT ( TheStreet) -- No question the auto industry is still rolling alone, economic uncertainty be damned. But as always, in February a few cars lagged behind the trends.

February sales results produced a multitude of positive metrics, including this one from the GM ( GM) sales call: February was the fourth consecutive month with a seasonally annualized adjusted sales rate above 15 million units.

"We have not seen an industry this strong since 2008,' said Kurt McNeil, GM's vice president of U.S. sales operations. "The difference between then and now is that the escalator is heading up, not down." McNeil said sales are on track to meet GM's full-year forecast of 15 million to 15.5 million units.

As for the losers, two of them compete in what is generally viewed as the industry's toughest segment. There, the Chevrolet Malibu showed a decline of 26%. The Toyota ( TM) Camry, typically the best-selling U.S. car, showed a decline of 6%. The Hyundai Sonata showed a decline of 8%.

Maybe it's just because the Ford ( F) Fusion did so well in the segment, with sales up 28% to 27,875 units. "Mid-sized sedans are the most competitive segment," said TrueCar.com analyst Jesse Toprak. "They're all similar is design and value, so product is not the key differentiator." Rather, he said, it is more important to be the newest vehicle and to offer high incentives, as Ford did in February.

Our list of five not-so-hot cars in February includes two from the mid-sized segment as well as other cars affected by negative factors including rising fuel prices, lack of adequate distribution and supply constraints.

Chevrolet Malibu

February sales of the Chevrolet Malibu fell 26% to 14,817. Year-to-date sales are down 12% to 30,640.

During the GM sales call, analysts and reporters questioned the declining sales not only of Malibu but also of two other leading Chevrolet cars. Cruze fell 12% to 17,947 units while Sonic fell 24% to 6,020 units.

"Chevrolet is struggling with its brand-new Malibu in the intensely competitive mid-size sedan segment, where virtually everything is new," said Edmunds.com. analyst Michelle Krebs, in a prepared statement. "Cruze, reaching the end of its current life, is also suffering as Chevy substantially discounts the Malibu into Cruze pricing territory."

Don Johnson, vice president of Chevrolet sales and service, acknowledged: "Malibu has had a couple of bumps ... It's been a dogfight with a lot of good products" in the segment. But he said February retail sales rose 17% over January and inventory has declined from a 160-day supply in January to 120 days now.

He said Malibu retail sales rose 17% over January's level and inventory has declined from a 160-day supply in January to a 120-day supply today. Additionally, he said, year-over-year comparisons are difficult for the Chevrolet automobiles.

Toyota Camry

Sales of the Chevrolet Camry declined 6% to 31,270. Year-to-date Camry sales are up 0.5% to 63,167.

Toprak said competition from the Fusion is hurting the Camry, which is no longer the newest vehicle in the segment despite being introduced in 2012. "The newest product gets the most attention in this segment," he said. Additionally, he said Ford was aggressive in offering incentives to Fusion buyers.

Overall, Toyota sales rose just 4.3%. "Toyota's performance falls very much in line with what we saw from GM, with the truck line-up 16% and the car line down nearly 3%," said Edmunds.com analyst Jessica Caldwell, in a prepared statement.

Chrysler 300

Sales of the Chrysler 300 fell 35% to 5,023 units. Year-to-date sales are down 18% to 10,348.

Chrysler spokesman Ralph Kisiel said,"Retail sales of that model were down only 6%, so it primarily is a fleet issued."

The decline is also "linked to gas prices, which were up from $3.46 a gallon to $3.72 in one month," Toprak said. "There's a very strong correlation between gas prices and large sedans."

Some Chrysler buyers were evidently pushed to the smaller Chrysler 200. Its sales sale rose 18% to 11,446 in February and year-to-date are up 21% to 20,292.

Overall Chrysler Group sales rose 4% to 139,015 in February. "We warned at the end of 2012 that Chrysler's big year-over-year gains would slow down, and that's exactly how it's unfolded so far this year," said Edmunds' Krebs. "Still, Chrysler managed to have its biggest February in five years."

Lincoln MKZ

Sales of the Lincoln MKZ totaled just 945, down 62% from the same month a year earlier. Lincoln brand sales declined 29% to 4,883.

MKZ was expected to spark the revival of the Lincoln brand, but Ford is delaying deliveries while conducting extensive quality inspections of the cars, which are built in Mexico.

"We have started delivering approximately 100 MKZs per day, even as we continue running every MKZ through its quality validation process," said Ken Czubay, vice president for U.S. marketing, sales and service on the Ford sales call. "We are targeting dealers to be at normal MKZ stock positions at the beginning of April," he said.

"Lincoln's performance was dismal," said Krebs. "Lincoln had a small upward blip in consideration on Edmunds.com in December when it kicked off its advertising for the new MKZ and the new positioning of the brand. But it dropped back when Lincoln postponed significant deliveries of the new MKZ until spring."

Toprak said "dealerships are complaining that they are not getting enough inventory, but the larger issue is brand image. Lincoln has to find a way to get younger buyers. It's doable, but it's a five-to-10 year process that requires a lot of persistence."

Volkswagen Jetta

February sales of the Volkswagen Jetta sedan fell 11% to 10,398. Year-to-date sales are down 8.3% to 19,487. Overall Volkswagen February sales rose 2.9% to 31,456.

Toprak said Jetta faced difficult year-over-year comparisons. "But Volkswagen's general problem is that they have a strong presence in a lot of metropolitan areas, but they are not that strong in the middle of the country," Toprak said. "In the markets where they do well, they have reached a point where they are hitting the limit of sales.

"To go to the next level, to be the next Hyundai, Volkswagen needs more of a nationwide presence," he said. "It will be an uphill battle."

-- Written by Ted Reed in Charlotte, N.C.

>To contact the writer of this article, click here: Ted Reed

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