Michigan: Toyota Motor Corp led carmakers reporting declining US sales in January, as an industry aiming for another record year maintains hefty spending on incentives to keep consumers coming to showrooms.
Deliveries fell about 11 percent for both Toyota and Fiat Chrysler Automobiles NV. Sales also dropped for General Motors Co and Ford Motor Co, while Japan’s Nissan Motor Co and Honda Motor Co reported gains.
Carmakers spent about $645 more per vehicle on discounts, about $3,635 on average in January, according to ALG, which projects car and truck resale values. The industry relied on rich incentive offers and deliveries to fleet customers including rental-car companies last year on the way to a seventh straight year of expansion. Strong demand for pricier pickups and sport utility vehicles should ensure automakers will still manage to keep profits rolling.
“There is certainly weakness to start off the year,” Jeff Schuster, senior vice president of forecasting for LMC Automotive, said by phone. “It’s not unexpected given the overheating of sales, thanks to incentives in December.”
Auto sales probably slowed in January to a seasonally adjusted annualised rate of about 17.3 million vehicles, according to the average of 11 analyst estimates, from 17.9 million a year earlier. The pace was 18.4 million in December, the best in more than a decade. GM said the light vehicle sales rate may have been 17.6 million in January in an e-mailed statement Wednesday. Ford predicted a pace in the low- to mid-17 million range, including medium- and heavy-duty trucks, on a conference call with analysts and reporters.
“This is still a healthy level of sales,” said Michelle Krebs, senior analyst with car-shopping website Autotrader.com. “The year is opening with a bit of a hangover because of the extreme discounts we saw in December. It’s taking more incentives to move the metal.”
The biggest gainer among major automakers will probably be Volkswagen AG, which reported a 15 percent jump for combined sales of VW and Audi models, as the German automaker rebounds amid a diesel model buyback programme.
Deliveries of Ford’s F-Series, which is coming off the 40th consecutive year as the best-selling truck in the US, climbed about 13 percent last month.
Nissan’s Rogue, which displaced the Altima sedan as the company’s UStop-seller last year for the first time, surged 46 percent in January.
Ram pickup deliveries rose 3.7 percent, blunting the impact of Fiat Chrysler ending sedan production at two US plants.
GM said it set a new January record for average transaction prices as it dialed back spending on incentives.
