As automakers' April sales fall, Wall Steet worries the boom is over
DETROIT (Reuters) - Major automakers on Tuesday posted declines in USnew vehicle
sales for April in a fresh sign the long boom cycle that lifted the American auto industry to record sales last year is losing steam, sending carmaker stocks down.
The drop in sales versus April 2016 came on the heels of a disappointing March, which automakers had shrugged off as just a bad month. But the two straight weak months are heightening Wall Street worries the cyclical industry is on a downward swing after a boom that has gone nearly uninterrupted since 2010 in the wake of the Great Recession.General Motors
shares were down 3.2 percent, whileFord
slid 4 percent andFiat
Chrysler Automobiles NV's US-traded stock tumbled 5.1 percent.
No. 1 US automakerGM
reported a 6 percent decline in April sales to 244,406 vehicles, butcrossovers
and trucks continued to see strong growth.
Sales at Ford, the No. 2 US automaker, fell 7.2 percent in April, whileToyota
recorded a drop of 4.4 percent andFCA
sales were off 7 percent.
Over the past couple of years, US consumers have increasingly shunned cars in favor of larger crossovers, SUVs and trucks. While automakers posted steep declines for car sales in April, SUVs, crossovers and trucks were either up or off slightly.
New vehicle sales have risen ever since the end of the Great Recession, hitting a record of 17.55 million units in 2016. But as the consumer appetite fornew cars
has waned, automakers relied on discounts to push vehicles to potential buyers.
GM said its consumer discounts were equivalent to 11.7 percent of the transaction price. The automaker also said its inventory level rose to 100 days of supply at the end of April versus around 70 days at the end of 2016.
Recent levels have worried analysts, and GM has promised inventories will be down by the end of 2017.
On a conference call, Mark LaNeve, Ford's vice president for US marketing, sales, and service, said the industry was "relatively constrained" in offering discounts in April.
"We were very constrained and disciplined, so I think nobody was trying to force the industry other than some spot incentives that you see and hear in some of our competitor's specific products," he said.Ford car
sales dropped 21 percent, and trucks declined 4.2 percent, while SUV sales rose 1.2 percent.
brand posted an 11.1 percent slide. U.S. car sales at the Japanese automaker were down 10.4 percent, whiletruck sales
were up 2.1 percent.Nissan
said April US sales were off 1.5 percent, but SUVs, crossovers and trucks jumped 11 percent.By Nick Carey Related Video:
via Autoblog http://www.autoblog.com
May 2, 2017 at 05:43AM