The U.S. auto monthly sales figures are out of the bag for April. And though several industry analysts gave a grim outlook for 2014 saying that it would be a flat year, auto sales didn’t reflect such sentiment in April. Buyers shrugged off their anxiety regarding the sluggish economy and continued visiting dealer showrooms helping automakers bag big numbers and report high sales volume.
What Does the Detroit Say?
General Motors (NYSE:GM), which was busy recalling troubled cars, managed to gain 7% in sales volume on the back of strong demand for its pickups. The Detroit carmaker delivered 254,076 vehicles during the month compared with 237,646 units sold in the year-ago period. Investors were quite apprehensive regarding the massive recalls due to faulty ignition switches and the negative publicity, and considered that it would have substantial bearing in the company’s April sales numbers. But they were quite relieved after the largest U.S. automaker recorded sales gain.
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The second Detroit automaker Ford (NYSE:F) saw its sales volume plummet 0.7% to 211,126 units from 212,584 recorded in the last year comparable period. This sales slip is attributable to its passenger cars and the Lincoln brand, both of which registered fall of 8.5% and 11%, respectively. In fact mid-size cars sales remained a weak point for all the Detroit automakers. But as far as pickups sales are concerned, like fellow player GM the Blue Oval too saw its truck sales rise.
Chrysler was the biggest gainer of the Detroit Three. The auto major’s sales volume increased 14% by selling 178,652 cars and trucks against last year’s 156,598. Sales figure was boosted by its high selling Ram pickup truck and Jeep sport-utility vehicles, which recorded its best ever month in April.
Asian counterparts made massive money during the month. Toyota’s (NYSE:TM) performance was upbeat – the global major sold 199,660 vehicles in April, compared with 176,160 units a year ago.
Japanese fellow player Nissan (NSANY) witnessed solid sales rise of more than 18% to 103,934 vehicles. Nissan Leaf, the top selling electric car in the world, saw its sales spike by an astounding 33%. The carmaker’s luxury Infiniti segment also got considerable boost as demand soared for these cars. The best-selling Nissan models – the Altima, the Sentra and the Versa – posted combined sales of 49,565 units, an increase of 30.5% over last year.
Honda (NYSE:HMC) recorded sales increase of 1% to 132,456 vehicles, while Hyundai Motor (HYMTF) volumes rose 4% - thanks to its subcompact Accent, Sonata sedan, and Sante Fe sports vehicle. However, German auto major Volkswagen (VLKAY) continues to struggle in the U.S. and saw shrinking volumes of 30,831 vehicles, a fall of 8.4% against last year. Volkswagen’s Golf and Beetle performed poorly as sales saw a sharp drop of 31% and 28%, respectively.
According to researcher Autodata Corp., total auto sales volume recorded during the month stood at 1.39 million vehicles, up 8% from last year. This translates into a seasonally adjusted annual rate (SAAR) of 16 million cars and trucks. However, March car sales volume resulted in annualized selling rate of 16.4 million vehicles.
The U.S. auto industry is successfully maintaining the positive momentum, despite the overall dullness in the economy. There’s no doubt that cars are the soft spot of most American, which is pretty evident from the growing sales number. If sales continue to grow at this pace throughout the year, 2014 would be the first year after 2007 to record sales volume of more than 16 million vehicles. Industry experts and investors would keep a close watch at the demand for cars and pickups to understand where the industry is headed for the year.