|New Threads Only:|
|New Threads & Replies:|
Forum List » Guru News and Commentaries|
Guru News, Stock picks and commentaries
US Auto Sales Remain Solid with Positive Outlook
Posted by: Live investor (IP Logged)
Date: November 10, 2013 04:56PM
The US automobile industry is experiencing a fantastic year as October sales also continued to be robust despite concerns over government shutdowns. In fact automakers saw 12% higher sales than last year’s October figures. Pickups saw the best sales, thanks to the rebound in the housing sector, improvement in businesses and strong consumer confidence. The seasonal adjusted annual sales rose to 15.2 million cars compared to 14.4 million in the last year. Let’s check the details of individual carmakers and see how they performed during the month.
A look at the performance
Pickup trucks have been experiencing solid sales this year, and this is of great advantage for the Detroit Three. Heavy demand for trucks and sports utility car gave boost to General Motors (GM), Ford (F) and Chrysler which gave the three domestic players an edge over foreign counterparts. The top US automaker, General Motors reported 16% year over year increase in sales, followed by the Blue Oval which posted a gain of 14%, and Chrysler which recorded 11% sales rise over last year comparable month.
Ford’s F-Series saw massive sales during the month, so did General Motors Chevy Silverado and Chrysler’s Ram trucks. Ford’s F-Series enjoyed the highest sales gain of 50% over last year’s October sales. Chrysler’s October gain was in line with the sales rise of its Jeep Grand Cherokee, which saw sales jump of 20%, and the recently redesigned Ram which saw 18% sales gain.
These domestic players have been heavily spending on improving their technology to boost the fuel efficiency of their pickups and SUVs. Other than pickups, both General Motors and Ford saw improvements in their midsized sedans segment as well. The top Detroit maker’s revamped Malibu and Chevy Impala sales increased 64% and 40% respectively, while Ford Fusion’s sales went up 71% over last year.
Obviously these American players outpaced their foreign rivals Toyota (TM), Honda (HMC) and Volkswagen. The Japanese players Toyota and Honda do not specialize in trucks and pickups, and are mostly known for their cars. Volkswagen, on the other hand, does not sell pickups in the US at all. So these automakers couldn’t benefit as much as the Detroit giants whose strength lies in pickups. In fact, Volkswagen suffered sales loss of 18% in October. Toyota gained 9% while Nissan (NSANY) saw sales rise of 14% during the month. Though overall sales for Toyota improved, Camry and Scion deliveries dropped 2.6% and 16% respectively.
Industry observers said that the disturbance in the Washington shook consumer confidence a bit in the beginning of the month, but showroom footfall returned to good numbers in the second half of the month. The US government has created an atmosphere of uncertainty, but thankfully it is not showing a severe impact on car buyers.
The bottom line
The holiday season is ahead and automakers are preparing for the year end offers and incentives to clearly their stock. Sales in the last quarter are expected to remain strong to end the year at a solid note. Demand for trucks and pickups shall remain high as the housing sector rebound is there to stay. This is good news for the Detroit auto giants. Foreign automakers might not gain as much as these domestic players, but they are still going to benefit from improving consumer spending as pent-up demand to replace aging cars remains high. In all, the US auto market remains pretty encouraging and exciting both for automakers, investors and buyers.
Stocks Discussed: GM, F, TM, NSANY, HMC,
Disclaimers: GuruFocus.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on GuruFocus.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The gurus may buy and sell securities before and after any particular article and report and information herein is published, with respect to the securities discussed in any article and report posted herein. In no event shall GuruFocus.com be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on GuruFocus.com, or relating to the use of, or inability to use, GuruFocus.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. The gurus listed in this website are not affiliated with GuruFocus.com, LLC. Stock quotes provided by InterActive Data. Fundamental company data provided by Morningstar, updated daily.