US Automakers Outsell June Estimates, End Anemic 1-H
Demand for light trucks gave FoMoCo (NYSE:F). and top Japanese automakers better sales than analysts had estimated for June following a 5-month streak of industry declines.
Toyota Motor Corp.’s (NYSE:TM) deliveries rose 2.1% June, while Honda Motor Co (NYSE:HMC) sales rose 0.8% from the same frame last year, both surpassing analyst estimates.
Nissan Motor Co., which had been expected to record a 2% drop, saw sales rise 2% instead.
Sales of Toyota’s RAV4 spiked 25%, while Honda’s HR-V saw a 35% gainer.
Ford’s biggest money maker, the F-Series truck line, rose 9.8%.
Collapsing demand for sedans and coupes by American consumers and rental-car companies alike have produced small declines in US sales volumes every month this year, and projections indicate that pattern will hold in June.
The pace of sales typically increases in 2-H of the year powered by promotions starting with the July 4th Holiday and lasting through year-end discounts, but none of the analysts surveyed project another year of record sales.
“Recent history has shown that the second half is usually pretty good,” an analyst with Edmunds, said last week in an interview, noting that the better sales will come at a cost. “I think because of some of the inventory situations, pretty much across the board by all automakers, that we’ll see heavier incentives, especially at the end of the Summer.”
General Motors Co. (NYSE:GM) is the only carmaker to have missed estimates in reporting so far, with sales dropping 4.7% as it curtailed fleet sales. Its truck-focused GMC brand reported a 3.6% decliner.
Among the biggest automakers, only Toyota and Honda had been expected to report increases in June deliveries.
Volkswagen AG, (OTCMKT:VLKAY) the world’s biggest automaker, but a smaller player in the US, may have seen its combined VW and Audi brand sales rise with the addition of the VW Atlas SUV that is made in Chattanooga, Tennessee.
GM, Ford and Fiat Chrysler Automobiles NV (NYSE:FCAU) are all shortening Summer shutdowns or forgoing them altogether at some US plants that make popular SUVs and pickups as demand for the bigger vehicles continues.
At the same time, several car plants are bracing for a cut in Summertime shifts and output as manufacturers try to align supply with still-slumping passenger-car demand.
The industry wide selling rate, adjusted for seasonal trends, may have slipped in June to about 16.6-M, compared with 16.8-M a year ago, according to the average of analysts’ estimates.
The full-year total of 17.2-M analysts are projecting would end a 7-year winning streak for the auto sector but would still mark the 4th-best year on record.
The industry sold 17.55-M cars and light trucks last year.
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