Auto sales rebounded in Oct 2013, after a weak September. Although the partial government shutdown negatively affected sales in the first two week, sales recovered thereafter. As a result, auto sales in the U.S. increased 10% to 1.2 million units in October. However, sales on a seasonally adjusted rate (:SAAR) basis declined 0.5% over September to 15.2 million vehicles.
While Ford Motor Co. (F) recorded the best October retail sales since 2004, General Motors Co. (GM) led in terms of year-over-year increase in sales. Other major automakers like Chrysler, Toyota Motor Corp. (TM), Honda Motor Co. (HMC) and Nissan Motor Co. (NSANY) also reported strong sales figures.
Let's look at the U.S. sales figures reported by individual automakers.
General Motors recorded 226,402 vehicle sales in October, surging 16% year over year due to strong demand for its Chevrolet, Cadillac and Buick-GMC brands. Retail sales increased 16%, while fleet sales improved 14%. The company is launching Chevrolet Silverado High Country and GMC Sierra Denali in November, which should add to sales in the coming months.
Ford reported a 14% increase intotal sales to 191,985 vehicles. The company has generated year-over-year growth in sales in every month since Nov 2012. Retail sales surged 15% to 142,487 vehicles. The impressive performance was mainly driven by strong demand for its F-Series pickup truck, Fusion and Escape.
Sales of the Escape grew 12% to 22,253 units while Fiesta sales escalated 9% to 4,337 units. Sales of Fusion surged 71% to 21,740 units. Fiesta and Fusion recorded their highest October sales. Sales of F-Series pickup truck grew 13% to 63,803 units.
Chrysler Group – controlled by Italy’s Fiat SpA (FIATY) – recorded an 11% year-over-year rise in sales, bringing the figure to 140,083 vehicles, driven by strong demand for its Ram pickup truck. This is the best October sales for the company since 2007.
Chrysler has witnessed year-over-year increase in monthly sales for 43 consecutive months. Ram truck sales gained 22% during the month, while Dodge brand sales increased 12%. Even Jeep brand sales improved 7% year over year.
Toyota sales increased 8.8% on volume basis to 168,976 units. Sales increased 4.8% year over year on the basis of daily selling rate (:DSR). Sales in the Toyota division improved 8% on the basis of volume and 4% on DSR basis to 146,257 units. Lexus sales surged 10.2% on DSR basis and 14.5% on volume basis to 22,719 units.
Honda recorded a 3.1% year-over-year increase in sales on DSR basis and 7.1% rise on volume basis to 114,538 vehicles due to higher sales in both Honda and Acura brands. While sales in the Honda division increased 5.7% to 100,242 units, sales in the Acura division surged 17.5% to 14,296 vehicles. Acura truck sales increased 38.3% on volume basis and 33.2% on DSR basis over Oct 2012.
Nissan Motor posted a 14.2% year-over-year increase in sales to 91,018 vehicles in October. Sales in the Nissan division also surged 15.4% to 81,866 units, due to significant increase in sales of Rogue, Pathfinder, LEAF and Frontier models. Even the sales of the Infiniti Division increased 4.5% to 9,152 units in the month.
As expected, the weak sales figures in September were a temporary phenomenon resulting from the inclusion of the Labor Day weekend, which usually witnesses strong sales, in August this year instead of September as usual. Despite the U.S. government shutdown, auto sales remained strong in October.
The strong sales trend is expected to continue in the rest of the quarter on the back of strong pent-up demand, easier car financing, low gas prices and improving macroeconomic conditions such as low interest rates, improving unemployment rates and recovery of the housing market. These catalysts are expected to drive the U.S. auto sales to the pre-recession level.
Moreover, as the automobile sector is a key industry for growth, improving auto sales will also help the overall economic recovery in the U.S. General Motors expects full-year sales to exceed its guided range of 15.0–15.5 million units, while Ford expects annual sales in the band of 15.0–16.0 million units in the U.S., compared with 14.5 million unit sales recorded in 2012.Read the Full Research Report on F
Read the Full Research Report on HMC
Read the Full Research Report on TM
Read the Full Research Report on NSANY
Read the Full Research Report on FIATY
Read the Full Research Report on GM
Zacks Investment Research
- Consumer Discretionary
- Automotive Industry