Chrysler says monthly sales are up 51 percent Exec: Earlier sales inscentives helped send automaker into bankruptcy

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AUBURN HILLS, Mich. - A top executive at Chrysler Group LLC said Wednesday that retail sales to individual buyers at the automaker are up 51 percent this month compared with February.

But Fred Diaz, CEO of the company's Ram truck brand, said overall sales, including fleet, are trending about 10 percent below March of 2009, when Chrysler spent thousands of dollars per vehicle on rebates and other incentives as it tried to win federal aid and forestall a bankruptcy filing.

Diaz said incentives of up to $8,000 per vehicle last year cheapened Chrysler's brands and probably backfired by helping send the company into bankruptcy protection. Chrysler has since accepted billions in federal loans and is 10 percent owned by the government.

But Diaz said the days of producing more vehicles than the market will buy are over as Chrysler focuses on rebuilding its image. He made the remarks at an event unveiling the marketing campaign for the Ram Heavy Duty pickup truck.

Chrysler sold about 84,000 vehicles in February. That's flat compared with last year as sales for the broader industry rose 13 percent from the same month in 2009. But half of Chrysler's February sales were to rental car companies and other fleet buyers.

The company also led the industry in incentive spending last month at an average of $3,388 per vehicle, according to the Edmunds.com automotive Web site.

Diaz wouldn't reveal how much of March sales were to fleet buyers, who generally bring car companies lower profits than consumers. But he said the company plans for 20 percent to 25 percent of its sales to be to fleets for the full year.

He said March sales have been helped by option packages and because consumers are starting to believe Chrysler will stick around for the long term.

Industry analysts are predicting increased U.S. sales in March over last year due to heavy incentives from Toyota Motor Corp. as it tries to lure back buyers in the wake of several safety-related recalls.

Chrysler's heavy-duty Ram advertising campaign, which debuted last week, focuses on the truck's ability to do tough jobs or haul and pull trailers for recreation.

http://www.msnbc.msn.com/id/36020522/ns/business-autos/