Auto sales had a tough ride this year.
Figures for 2017 came in at 17.2 million units sold, down 1.8% from a record 17.55 million units sold in 2016, according to Autodata Corp. Sales for December tumbled 5.2%, with the three US automakers reporting declines. This was the first year-over-year sales decline since the financial crisis era of 2010.
And auto sales are expected to fall even further. While there may be low unemployment in the economy, rising interest rates will make it difficult for people to finance new vehicles. This is, however, not the only factor that can cause a sales slump this year. People are keeping vehicles for longer period of time. The average age of vehicles currently stands at 11.6 years versus 8.8 years in 1998.
Here’s a detailed look at how the U.S. and other automakers performed in December.
Performance of US automakers
General Motors (GM, Financial), the leading U.S. automaker, witnessed a 3.3% sales decline to 308,539 units in December. GMC and Buick saw sales gain of 1.2% and 4.7%, respectively. But it was GM’s flagship Chevrolet brand -- down 2.9% year-over-year -- and the Cadillac luxury lineup -- down 28.6% -- that let the company down. GM’s retail sales, on the contrary, surged 1.8%. The company’s average transaction price for 2017 was $35,400, which was more than the industry average of $31,600.
Ford (F, Financial)'s December sales dropped 0.9% year-over-year to 242,049 vehicles. For the whole year, the Blue Oval sold 2.59 million vehicles. While Lincoln sales declined 17%, Ford brand sales increased 1.9%. The company’s F-Series pickup truck, unsurprisingly, was the best-selling vehicle in the U.S. Ford sold 896,764 F-Series trucks in the country. This was the best year for F-Series trucks since 2005.
Chrysler (FCAU, Financial) sales dipped 10.7% to 171,946 in December. Both retail and fleet sales striggled, with retail dipping 3% and fleet plunging 42%. Major brands reported sales declines, including Jeep (down 12%), Dodge (23.2%), Ram (down 6.9%) and Fiat (down 33.3%). The company sold 2.06 million vehicles in 2017.
Performance of other automakers
The world’s largest automaker, Toyota (TM, Financial), saw an 8.3% sales decline to 222,985 vehicles. The sales decline was due to poor performance of Toyota brand and luxury Lexus lineup whose sales dropped 7.2% and 13.9%, respectively. Sales of cars, crossovers, pickups and SUVs added insult to the injury. Car sales dipped 12.2% while the combined sales of crossovers, pickups and SUVs plunged 5.9%.
For Nissan (NSANY, Financial), December sales slumped 9.5% to 138,226 vehicles. The company’s sales totaled 1.59 million vehicles for 2017. For December, Nissan brand sales plunged 9.4% year-over-year, and Infinity brand sales were down 10%. On the other hand, Rogue crossover sales spiked 22.3% as compared with 2016 December. Honda Motor Company (HMC, Financial) saw a 7% sales decline on a year-over-year basis to 149,317 vehicles, while for the entire year, the company sold 1.64 million vehicles.
Disclosure: I do not hold any position in the stocks mentioned in this article.
