Light vehicle sales in the U.S. rose a tad by 2.4% to a seasonally adjusted annualized rate of 11.41 million vehicles in June from 11.14 million vehicles in the same month last year. It came down from the seasonally adjusted annual rate of 11.8 million in May, the slowest since June 2010. Total sales inched up 7.1% to 1.05 million vehicles during the month.
The lackluster sales was primarily attributable to the earthquake and tsunami in Japan on March 11 that caused supply shortages of many fuel-efficient vehicles, especially small cars, which enjoy a huge demand on the back of rising gas prices. This apart, lower incentive, thinner inventory level, deferral of consumer purchases due to a slow economic recovery contributed to the sluggish sales.
Sales at General Motors Co. (NYSE:GM - News) grew 10.2% to 215,358 vehicles. Retail sales contributed 16% to the overall sales growth. Chevrolet Cruze car, Silverado pickup and Malibu car were the top selling passenger vehicles during the month.
Sales at Ford Motor Co. (NYSE:F - News) escalated 13.6% to 194,114 vehicles. The sales growth was mainly driven by cars and utilities, whose sales rose 17% and 15%, respectively during the month. Fiesta and Focus were the highest selling small cars during the month. Sales of the company’s best selling F-series trucks rose 6.7%.
Sales at Chrysler Group LLC, controlled by Italy’s Fiat SpA (FIATY), surged 30% to 120,394 vehicles. It was the best sales for Chrysler in a month since 2007. The company’s retail sales improved 46% during the month.
Together, GM, Ford and Chrysler achieved a market share of 50.1% last month. According to Autodata this the first time that the market share of the combined companies have shooted above 50%, since August 2009.
Sales at Toyota Motor Corp. (NYSE:TM - News) fell 21.1% to 110,937 vehicles due to the supply shortages caused by the natural disaster in Japan. Sales of its best-selling Camry brand dipped 24.8% to 18,830 vehicles and that of Corolla declined 13.7%. Total light truck sales decreased 12.5% during the month.
Sales at Honda Motor Co. (NYSE:HMC - News) tumbled 21.3% to 83,892 vehicles due to the same reason. Sales of Honda’s best-selling Civic model ebbed 34% to 18,341 units, while sales of Accord and CR-V fell 36.1% and 3.4%, respectively..
However, sales at Nissan Motor Co. (Other OTC:NSANY.PK - News) improved 11.4% to 71,941 vehicles during the month under study. Nissan Division sales grew 16.7% while that of Infiniti vehicles fell 24.3% during the month.
Given the surging gas prices, we expect strong demand for smaller and fuel-efficient vehicles to continue in the near future. However, supplies of fuel-efficient vehicles would remain under pressure given the supply constraints stemming from the earthquake and tsunami in Japan.
According to Thomson Reuters/University of Michigan final index, U.S. consumers’ confidence fell more than anticipated in June. Moreover, the New York-based Conference Board revealed that the percentage of consumers planning to buy a new vehicle within six months fell to 3.1%, the lowest since December 2010.
However, Edmunds.com and J.D. Power & Associates predicted that auto sales will recover in the second half of the year and annual deliveries will improve to 12.9 million vehicles.
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