Another strong month at the Jeep and Ram brands, combined with higher incentives and fleet shipments, helped FCA US post a 2.5 percent rise in January U.S. light-vehicle sales. Higher light-truck sales also delivered overall gains at Ford Motor Co. and Honda Motor Co. but volume fell at Toyota and Nissan to start the year.
It was FCA’s 11th straight gain in year over year monthly sales.
Deliveries rose 24 percent at Ram, behind a 19 percent surge in pickup sales, but slipped 2.2 percent at Jeep. FCA said the severe cold wave in the Midwest and Northeast -- key regions for Jeep -- dampened demand for the brand's lineup late in the month, though volume still came close to 60,000 units.
Sales fell 15 percent at the Chrysler brand, 1.9 percent at Dodge, 39 percent at Fiat, and 30 percent at Alfa Romeo.
FCA also received a big boost from fleet deliveries, which jumped 50 percent to 31,792 during the month. FCA's average new-vehicle incentive also rose 6.7 percent to $4,573 last month, ALG estimated. (See chart below.)
"In spite of some frigid January weather, we remain bullish on 2019 given the continued underlying strength of the U.S. economy," Reid Bigland, head of U.S. sales operations for FCA, said in a statement.
At Ford, sales rose 7.1 percent, based on Automotive News Data center estimates, with volume up an estimated 6.5 percent at the Ford division and 20 percent at Lincoln. Ford's car sales dropped an estimated 1.7 percent and light-truck deliveries rose 9.2 percent.
Japan 3
Toyota Motor Corp. said sales dropped 6.6 percent, with volume down 7.1 percent at the Toyota division and 2.8 percent at Lexus. Car sales dropped 5.5 percent and truck deliveries, a bright spot for Toyota for months, declined 7.3 percent.
At Nissan Group, which has been dialing back on fleet business, sales dropped 19 percent behind a 25 percent decline in car demand and 13 percent drop in light-truck volume. Overall, sales dropped 20 percent at the Nissan division and 3.1 percent at Infiniti, even as the company's incentives last month edged up over January 2018.
American Honda, behind record January light-truck deliveries, posted a 1.5 percent increase in sales last month. Volume edged up 0.8 percent at the Honda brand and rose 9.6 percent at Acura. American Honda said its light-truck sales rose 4.3 percent to 58,738 while car demand slipped 1.7 percent to 47,401 during the month.
Even with extreme winter weather that cast a chill over showroom traffic in large swaths of the U.S., Henio Arcangeli Jr., senior vice president of the Honda's automobile division, said the company's January results signal there is "real consumer demand beyond trucks and SUVs."
Subaru extended its streak of year over year monthly gains to 85 with a 3.9 percent increase in January sales. At Mazda, volume dropped 20 percent.
Overall, analysts projected that U.S. light-vehicle sales will remain flat or fall slightly when other automakers report sales later today, with higher fleet volume offsetting lower retail demand.
The government shutdown and severe cold that blasted the Midwest this week both dampened consumer demand, some analysts said.
But solid economic growth, employment gains, low gasoline prices and available credit continue to support light-vehicle demand, analysts said, even as consumers face higher financing costs.
SAAR forecast
The seasonally adjusted annualized rate of sales for January is expected to come in at 16.9 million, based on a survey of 10 analysts by Bloomberg. That would be down from 17.22 million in January 2018 and December’s 17.72 million rate, and mark the first month the SAAR has dropped below 17 million since August.
January is typically one of the lowest months of the year for industry sales, with the least bearing on the year’s final results.
Company by company outlook
FCA was one of only two major automakers projected to post higher sales in January, according to a Bloomberg survey of analysts, with volume estimated to rise 5 percent at FCA and 4 percent at Honda Motor Co.
Sales were projected to fall 3.7 percent at General Motors, 1.5 percent at Ford, 3.8 percent at Toyota Motor North America and 14 percent at Nissan Group. Ford starting this year has joined GM in releasing U.S. sales results on a quarterly basis rather than monthly.
Among other major automakers, some analysts have sales rising at Hyundai and Kia, helped by new crossovers, while falling at the Volkswagen Group.
Incentives
Average incentive spending per new light-vehicle was tracking at $3,720 in the first few weeks of January, down from $3,856 during the same period last year, J.D. Power said, adding it would be the seventh-straight month of lower discounts. ALG estimated that the average incentive slipped 0.9 percent from a year ago to $3,642 last month, and 3.1 percent from December, with the Detroit 3 and Nissan among the biggest spenders.
