Japanese cars make a comeback

GM, Ford lose U.S. market share in July

Honda saw its sales increase by 45 percent in July, thanks in part to the Civic, whose sales jumped more than 78 percent to just over 25,000. Honda's quarterly profit quadrupled to $1.7 billion as the Japanese automaker quickly bounced back from last year's natural disasters, hurting both Ford and GM.

DETROIT -- Just when Detroit seemed to be luring them away, Americans are embracing Japanese cars again.

Toyota and Honda lost ground last year after the Japanese earthquake limited their supplies. But July's U.S. sales show they've nearly regained what they lost, at the expense of General Motors Co. and Ford Motor Co.

GM sales fell 6 percent and Ford sales were down 4 percent compared with last July.

Chrysler Group LLC said it sold 126,089 vehicles in July, up 13 percent from 2011.

Sales of the Toledo-built Jeep Liberty were up 34 percent in July compared to last year, helping to lead the Jeep brand to a 7 percent increase.

"July was another solid month for Chrysler Group as we again demonstrated our disciplined and methodical approach to growing sales and profits," said Reid Bigland, Chrysler's head of U.S. sales.

With 12,216 sold, the Toledo-built Wrangler remained Jeep's top-selling model, though sales fell 15 percent compared to July, 2011. In that month, Chrysler sold 14,355 Wranglers for a then all-time monthly sales record. The record was topped in May and again in June this year.

For the year, Wrangler sales are up 23 percent, while Liberty sales are up 35 percent.

Chrysler also saw strong demand for its Ram pickup and Chrysler 200 sedan.

Honda's sales were up 45 percent in July, and Toyota jumped 26 percent. Overall car and truck sales rose 9 percent to 1.15 million, according to Autodata Corp.

"Toyota and Honda have regained all of the share they lost, and much faster than we thought they would," said Jesse Toprak, vice president of market intelligence for the car buying site TrueCar.com. "Their customers appear to be a lot more loyal than we gave them credit for."

Mr. Toprak and others thought that newer, better products at GM and Ford, like the Chevrolet Cruze and Ford Focus small cars, might permanently pull customers away from the Japanese after the earthquake disrupted their supplies. Toyota had virtually no Prius hybrids to sell last summer, for example.

But rivals' gains haven't lasted. The Cruze, which was the best-selling subcompact in the country last July, saw sales plummet 40 percent last month. It was far outsold by the Honda Civic, whose sales jumped more than 78 percent to just over 25,000. The Toyota Corolla also topped the Cruze and Focus, even though it's an older car with fewer features.

Toyota commanded 14.3 percent of the U.S. market in July, up from 12.3 percent a year ago and back to pre-earthquake levels. GM had a 17.4 percent share, which matched its pre-earthquake level and was down from 20.3 percent last July.

It was good news for the Japanese in an otherwise stagnant month for the U.S. auto industry. July sales stayed at nearly the same pace they were in June, or about 14.1 million on an annualized basis. While that's better than the 12.8 million cars and trucks sold in 2011, it's a slower pace than at the start of this year.

As a result, Mr. Toprak lowered his forecast for full-year sales to 14.3 million, from 14.5 million at the start of this year. LMC Automotive, an industry consulting firm, plans a similar cut to its forecast, said Jeff Schuster, LMC's senior vice president of forecasting.

Uncertainty over bad economic news from Europe, weak consumer confidence, and slow job growth likely will scare some buyers away unless they absolutely have to buy a car, Mr. Schuster said.