Jeep propels FCA to 5% gain; Ford falls

UPDATED: 5/1/18 9:28 am ET

FCA US posted a 5 percent gain in U.S. sales last month behind a surge in volume at Jeep.

Sales at Jeep rose 20 percent to 82,641 -- an April record for the brand -- while deliveries slipped 9 percent at Ram, 18 percent at the Chrysler brand and 45 percent at Fiat.

Dodge, behind higher Journey and Caravan deliveries, broke a string of 10 straight monthly declines year over year with an April gain of 4 percent. FCA said retail sales last month slipped 1 percent to 143,995, while fleet accounted for 22 percent of overall deliveries.

At Ford Motor Co., volume dropped 4.7 percent behind lower car and SUV demand. Sales fell 4.3 percent at the Ford division and 12 percent at Lincoln.

Ford said April car deliveries slipped 15 percent and SUV sales dropped 4.6 percent, while truck sales edged up 0.9 percent.

Because of the timing of orders, April fleet shipments fell 8.6 percent to 67,602, Ford said.

When other automakers report April results later today, analysts expect industry volume to slip overall, with a decline as much as 3.6 percent, according to Cox Automotive.

An exact tally will not be available now that General Motors is releasing U.S. sales results on a quarterly basis rather than monthly. Several analysts will continue to estimate GM’s monthly results.

April had two fewer selling days and one less weekend of sales compared with April 2017.

Through March, U.S. light-vehicle sales had risen 2 percent.

Sales continue to be driven by healthy light-truck demand -- notably crossovers – and higher fleet sales, while car volume continues to weaken. Low but rising finance rates, moderate but rising gasoline prices as well as steady job gains are supporting industry sales, automakers and analysts say.

The shift to crossovers, SUVs and pickups continues to lift transaction prices. The average new-vehicle retail transaction price for April was tracking at $32,544, a record for the month, surpassing the previous high of $31,414 set in April 2017, J.D. Power says. ALG estimates the average transaction price for a new light vehicle was $33,515 in April, up 2.7 percent from a year ago.

Overall, U.S. sales this year are forecast to drop below 17 million for the first time in three years. Most estimates from analysts range from 16.7 million to 16.9 million units.

The U.S. new-vehicle market, after seven straight annual gains capped by a record 2016, slipped 1.8 percent to 17.245 million units last year.

SAAR outlook

The seasonally adjusted annualized sales rate for April is expected to come in at 17 million, based on forecasts from analysts polled by Bloomberg. That would mark the eighth straight month the pace has topped 17 million. The March SAAR came in at 17.49 million, and the April 2017 SAAR was 17.08 million.

Company outlook

Ahead of today’s reports, April sales were projected by analysts polled by Bloomberg to fall at every major automaker. Volume was forecast to drop 2.9 percent at General Motors, 5 percent at Ford, 1.4 percent at FCA US, 6.1 percent at Toyota Motor Corp., 7.3 percent at Honda Motor Co., 9.7 percent at Nissan Motor Co., 11 percent at Hyundai-Kia and 1.8 percent at VW-Audi.

Spiffs

The average new-vehicle incentive was tracking at $3,698 in the first three weeks of April, J.D. Power says, up $187 from a year ago. The spending increase continues to be driven by trucks and SUVs — up $426 — while average spending on cars is down $226. ALG estimates average new-vehicle incentives rose 8.5 percent to $3,736 last month compared with April 2017, with the Detroit 3 among the biggest average spenders on deals.

Odds & Ends

There were 24 selling days last month vs. 26 in April 2017 … Edmunds says the average monthly payment on a new vehicle averaged $535 in April compared to $509 in April 2017 and $463 in April 2013. The average amount financed increased to $31,318 in April compared to $30,315 last year and $26,679 in April of 2013. Down payments also increased, reaching $3,911 in April, compared to $3,770 in 2017 and $3,494 in 2013 ... J.D. Power says days to turn, the average number of days a new vehicle sits on a dealership lot before being sold to a retail customer, was 68 through April 18, down 2 days from the same period in April 2017 … Light trucks accounted for 67 percent of U.S. light-vehicle deliveries in the first three weeks of the month, the highest level ever recorded in April, J.D. Power says … Kelley Blue Book says the shift to light trucks is driving gains in estimated average transaction price for light vehicles -- $35,411 in April. increased by $710, up 2 percent, from April 2017, but down $99, or 0.3 percent, from March ... Incentives, expressed as a percentage of sticker price, stood at 10.3 percent in early March, matching or exceeding the 10 percent threshold for the 20th time over the last 21 months, J.D. Power says.

Quotables

“March benefited from an extra weekend this year, while April sales have been negatively affected by having one less selling weekend compared to 2017. When looking at the two months combined, retail sales will be down only modestly from last year.”

-- Thomas King, J.D. Power.

“The sales rate has been at or above 17 million since last August, suggesting the vehicle market is on sound footing. Along with positive economic news, buying conditions remain strong with robust credit availability and aggressive … vehicle incentives, and these conditions are expected to remain through much of 2018. In addition, overall sales volumes have been supported by notable fleet activity, which is running above last year’s rate.”

-- Charlie Chesbrough, Cox Automotive

“The auto industry is resilient and disciplined. It’s shrugged off most of the concerns to date. Going forward, it wouldn’t take much to turn delicate stability into more pronounced pullback. Keep an eye on the economy after 2018, as signals are increasing that a mild recession could be on the horizon.”

-- Jeff Schuster, LMC Automotive