U.S. sales at FCA US, Honda and Nissan rose last month while Ford, General Motors and Toyota posted declines, capping a year that saw the industry offset plunging demand for cars with healthy light-truck deliveries.
The results released so far are in line with forecasts pointing to a December that will be on par with year-earlier figures. That means the auto industry's sales total for the year will top those of 2017, defying predictions of a slump. GM on Thursday predicted an industry sales tally of 17.3 million for 2018, the fourth-highest on record.
FCA US said December sales rose 14 percent, driven by gains of 10 percent at Jeep, 37 percent at Ram and 17 percent at Dodge. For the year, FCA's U.S. deliveries jumped 9 percent.
At Ford Motor Co., December sales dropped 8.8 percent, with volume off 9.6 percent at the Ford division but rising 8.5 percent at Lincoln. For the year, Ford sales dropped 3.5 percent behind an18 percent decline in car deliveries.
GM's U.S. sales dipped an estimated 3.7 percent last month. GM said Thursday it sold 785,229 light vehicles in the fourth quarter, a decline of 2.7 percent from the last three months of 2017.
Overall, GM's U.S. sales fell 1.6 percent to 2.95 million last year, with every brand posting lower volume. Buick, down 5.6 percent, led the decline. GM said its U.S. car sales slid 24 percent in the fourth quarter and 21 percent for the year, while light-truck demand rose 2.4 percent in 2018.
It was the third straight drop in annual U.S. sales at GM and Ford.
Japan 3
At Toyota Motor Corp., December volume dropped 0.9 percent, with sales down 1.1 percent at the Toyota brand but rising 0.2 percent at Lexus. For all of 2018, Toyota's U.S. sales edged down 0.3 percent, with car demand falling 12 percent and light-truck shipments up 7.9 percent.
Nissan Motor Co. volume rose 7.6 percent last month, including a 7.2 percent gain at the Nissan brand and 10 percent rise at Infiniti. The company's overall 2018 sales dropped 6.2 percent behind a move to lower discounts and fleet business.
American Honda said December sales rose 3.9 percent, with volume up 3 percent at the Honda brand and 11 percent at Acura. But total 2018 volume slipped 2.2 percent, with the Honda brand down 2.8 percent but Acura sales rising 2.8 percent.
Subaru milestone
Subaru rolled to another annual U.S. record, with December volume rising 1.9 percent, and 2018 sales of 680,135, a gain of 4.9 percent. It was the tenth consecutive year of record U.S. sales for Subaru and the eleventh consecutive year of gains.
Among other automakers, Mazda reported a 3.8 percent decline in December deliveries but a 3.8 percent increase in 2018 sales, and Mitsubishi said December sales rose 5.7 percent, with 2018 volume finishing 14 percent higher.
Across the industry, the sales tally is expected to come in flat or down slightly from December 2017 after other automakers report results later today. Still, analysts say December was on track to be the second-strongest month of 2018 -- after March – in terms of total volume.
"New vehicle sales were surprisingly strong in 2018 despite late cycle headwinds from higher interest rates and more nearly-new competition in the used market," Cox Automotive Chief Economist Jonathan Smoke said. "The key positive factor was stimulated demand from tax reform, which strengthened retail demand as the year progressed and also enabled strong gains in fleet sales.
Automakers sold 17.24 million vehicles in 2017 -- the fourth-best year on record, pending December's results.
Generous discounts and steady economic growth fueled new-vehicle sales throughout the year. U.S. consumers also appeared to shrug off slumping stock prices in December.
U.S. sales rose 0.4 percent through November, with higher fleet shipments offsetting a slight dip in retail demand during the year, analysts say.
SAAR forecast
The seasonally adjusted annualized rate of sales for December is forecast to come in at 17.3 million based on a survey of 10 analysts by Bloomberg. That would be down from December 2017's SAAR of 17.44 million and November's 17.55 million sales pace.
Heading into December, the SAAR had topped 17 million in all but two months in 2018.
For 2019, most early forecasts see total industry sales coming in at 16.8 million to 17 million units, with some estimates as low as 16.6 million. That would mark the first total below 17 million since 2014.
While interest rates are rising and used-vehicle supplies are growing, new-vehicle sales continue to be supported by light-truck demand, employment gains, healthy economic growth and low gasoline prices.
"Despite recent market turbulence, the data we have in hand suggests an economy that remains on solid footing heading into the new year," Ford Chief Economist Emily Kolinski Morris said Thursday during a conference call with analysts and journalists. "Consumers seem to be looking through market volatility to focus on continued positive job and income conditions."
Outlook by automaker
Ahead of today's results, among major automakers, December U.S. sales were forecast to rise at just two companies -- 15 percent at FCA US and 3 percent at Hyundai-Kia – based on a survey of analysts by Bloomberg. Volume was projected to fall 4.3 percent at General Motors, 6.2 percent at Ford, 2.5 percent at Toyota, 2.8 percent at Honda, 5.6 percent at Nissan and 6.1 percent at VW-Audi.
Incentive spending
Average new-vehicle incentives were tracking at $4,098 in early December, J.D. Power estimates, down $164 from December 2017. ALG estimates December incentives averaged $3,746 a vehicle, down 5.6 percent from $3,968 in December 2017. The Detroit 3, Nissan and Volkswagen Group were among the biggest spenders on discounts last month, ALG said. (See chart below.)
