U.S. Auto Sales Edge Up, but Pace Slows -- WSJ
02 July 2016 - 5:03PM
Dow Jones News
Industry growth slows as GM and Toyota post declines and
passenger cars fall
By Anne Steele and Jonathan Bach
U.S. auto sales last month rose at a pace that was the lowest in
at least 13 months as two of the biggest players reported declines,
adding to doubts about the industry's ability to maintain its
record clip this year.
General Motors Co., the nation's largest auto maker, reported
its sales slipped 1.6% amid a planned reduction in sales to fleet
buyers such as car rental agencies. GM's retail sales to individual
buyers edged up 1%, on strength in the Chevrolet, Buick and
Cadillac brands, it said.
Toyota Motor Corp., meanwhile, posted a 5.6% drop as car sales
fell 10% and truck sales edged less than 1% lower.
Overall, the annualized sales pace slipped to 16.67 million
vehicles last month, the lowest in at least 13 months on weaker
demand for passenger cars. Market researcher Autodata Corp.
reported total sales for the month of 1.5 million, up 2.5% from the
same month a year earlier.
Analysts had been looking for the sales rate to remain at 17
million vehicles or more. The weakness was largely confined to
passenger cars, which fell 8% from a year earlier; demand for light
trucks and sport-utility vehicles continued to gain. Light trucks
accounted for 58.9% of June sales, up from 54.2% a year ago,
Autodata said.
Other car makers held up better than GM and Toyota, helped by
sales of bigger vehicles. Ford Motor Co. posted a 6.4% gain to
239,096 light vehicles on sharply higher truck sales, which bounded
up 24%, and SUV sales, up 7.3%. Ford said its car sales skidded
12%.
"We cannot get enough Escape [SUVs]," said Jeff Brown, who
co-owns Brown's Ford dealerships in Johnstown and Amsterdam, N.Y.
Mr. Brown, 57 years old, said Escapes and F-150 pickups contributed
the most to his sales.
He forecasts an uptick in sales as the summer months progress.
Low loan interest rates and fuel prices are a green light for
pickup sales, he said.
Last year "might have been one of the best summers we had in 50
years," said Mr. Brown, adding if this summer's sales get near to a
year earlier "we'd be happy."
Fiat Chrysler Automobiles NV posted a 6.5% rise in U.S. auto
sales, fueled by robust demand for its Jeep brand. The Italian-U.S.
auto maker's sales fell just below Toyota and were its best June
sales in 11 years. Jeep brand sales jumped 17%.
Still, the growth didn't match past months. "What we're seeing
in June car sales is what we've predicted for some time," said
AutoTrader analyst Michelle Krebs. "The hefty year-over-year
increases are narrowing, which is expected after this unprecedented
long stretch of gains."
Sales got a boost from an extra selling day in the month
compared with the same period a year ago.
J.D. Power and LMC Automotive projected record incentives of
$3,278 a vehicle for the month. Industry analysts estimated more
than 20% of sales came from fleet buyers in June.
Nissan Motor Co. logged a 13% rise, a June record for the
Japanese auto maker, propelled by a 14% jump in sales of
crossovers, trucks and SUVs.
Honda Motor Co.'s sales rose 3.2% as light trucks climbed to a
June high as demand for its Civic and Accord cars helped drive
growth.
The average transaction price for a light vehicle sold in the
U.S. rose 2% to $33,652, according to researcher Kelley Blue Book,
driven by strength in trucks and SUVs.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
July 02, 2016 02:48 ET (06:48 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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