U.S. auto sales gained momentum in February after witnessing the strong snowstorms of January. Detroit automakers Ford Motor (F, Financial) and Fiat Chrysler Automobiles registered strong gains during the month. General Motors (GM, Financial), on the other hand, saw a sales decline resulting in loss of market share.
Sales spiked 7% during February on the back of low gasoline prices, availability of cheap credit and higher wages. Snowstorms in January prompted customers to delay their purchases to the next month, and this showed up in February numbers.
The numbers
The auto industry recorded the highest sales volume for February since 2001 by selling 1.34 million cars and trucks.
The seasonally annual adjusted rate stood at 17.53 million units, up from 16.39 million units in February 2015. Again, this was the highest SAAR for February since 2000. Asian automakers such as Toyota (TM, Financial), Honda (HMC, Financial) and Nissan (NSANY, Financial) also reported year-over-year sales improvement.
The Detroit three
General Motors, the largest U.S. automaker, delivered 227,825 vehicles in January, down 1.5% from the same period last year. However, its retail sales and commercial deliveries surged 6.6% and 7%. The company claimed it had sold 39% fewer vehicles to the rental car company, which resulted in the negative growth. The company’s only brand that posted a strong sales gain was Buick, up 20.4% to 36,080 units, while sales of Cadillac, GMC and Chevrolet dropped 3.2%, 2.1% and 2.1%.
The second-largest U.S. automaker, Ford, sold 217,192 vehicles in February, up 20.4% from the same period last year. The combined sales of the company’s SUVs and crossovers surged 28%. The sales gain is attributable to huge volumes of sales of Lincoln brand and vehicles and Ford brand whose sales surged 30.4% to 8,039 units and 20.1% to 209,153 units.
Rental car fleet sales were also up; 36% of the company’s U.S. sales went toward fleets in February. Mark LaNeve, Ford’s U.S. sales chief, said the company expects to record strong fleet sales during the first four months. Moreover, F-series pickup sales spiked 10%. Both Explorer SUV and Edge crossover posted heavy sales gain.
For Fiat Chrysler, February marked the 71st consecutive month of sales gain. The company delivered 182,879 vehicles representing 12%Â year-over-year increase. This also marks the company’s best February sales since 2006. Both Jeep brand and Ram pickup reported 23% sales increases. Truck sales climbed 27%.
Performances of other automakers
Toyota, the world’s largest automaker, witnessed 4.1% year-over-year sales gain to 187,954 units sold. Toyota division sales spiked 4.7% to 164,864 units, and Lexus sales improved a meager 0.4% to 23,090 units. In contrast, Prius Hybrid sales plunged 12%. However, the combined sales of SUVs and trucks surged 10%.
Honda’s sales improved 12.8% to a record 118,985 vehicles. Honda division sales climbed 14.9% to 106,212 units. Weak sales of the company’s luxury Acura division were compensated by a 20% sales improvement of its midsize sedan Accord.
Nissan posted a 10.5% year-over-year sales gain to 130,911 vehicles. The sales gain is attributable to sales in the Nissan division, up 12.9% to 120,540 vehicles. Murano SUV sales almost doubled, reiterating the popularity of SUVs. In contrast, sales of Infiniti division plunged 11% to 10,371 units.
Last word
Prospects look bright for the U.S. auto market. Analysts expect U.S. auto sales to see another record year in 2016, after posting solid numbers in 2015. Improvement in the employment rate, higher disposable income, declining gasoline prices, cheap finance and pent-up demand should keep the sales chart moving north. In addition, the average age of cars running in the U.S. is more than 11 years, which means the replacement demand should also boost numbers.
