What Market Slowdown? GM Full-Size SUV Sales Jumped 59 Percent In October

America’s auto industry has now reported year-over-year sales declines in three consecutive months. The size of the market was 3.5 percent smaller in the August-October period of 2016 than during the same stretch in 2015.

Yet during the same period, U.S. sales of General Motors’ six full-size SUVs jumped 39 percent, a rate of success that throws pie in the face of an industry that’s now fading.

In October, however, the market’s fade became much more apparent. Industry-wide sales slid 6 percent, year-over-year, the worst monthly downturn since the recession. Yet at the same time, General Motors reported a 59-percent surge in full-size SUV volume worth nearly 12,000 additional sales.

BACKGROUND

The auto industry’s seasonally adjusted annualized rate of 18 million units was the highest of any month this year and higher than all but three months last year. The quirky auto sales calendar — “October 2015” extended two days into November; October 2016 was two days shorter — also means the daily selling rate grew 1 percent, year-over-year. Achieving this level of volume wasn’t easy — the average per-vehicle incentive in October 2016 was 16 percent higher than in October 2015.

As for GM’s extraordinary full-size SUV growth, big discounts on remaining 2016s played a factor, as did a huge increase in fleet volume. Automotive News reports that the average transaction price among the Chevrolet/GMC quartet was $2,470 lower than the year-to-date average in October. Fleet volume, meanwhile, quadrupled to form 32 percent of the Chevrolet/GMC full-size SUV total, Automotive News reported.

DEMAND

Yet a 33-percent surge in retail sales of the dual Chevrolet/GMC twins makes clear that the huge October increase in overall GM full-size sales reflected real demand. These huge figures weren’t merely the result of GM’s need to clear out of stock.

Fully 12 percent of the new vehicles sold by General Motors in October were Cadillac Escalades and ESVs, Chevrolet Tahoes, Chevrolet Suburbans, and GMC Yukons and XLs, up from 7 percent a year ago. With the full-size pickup trucks on which these SUVs are based suffering an 8-percent sales decline in October, GM produced nearly one-third of its K2XX-platform volume with SUVs. A year ago, the SUVs generated barely more than one-fifth of that overall full-size volume.

COMPETITION? WHAT COMPETITION?

At the top of the leaderboard, Chevrolet Tahoe sales jumped 81 percent to 11,976 units, enough to make the Tahoe America’s 13th-best-selling SUV/crossover overall.

Gone are the glory days — the Tahoe ranked fourth overall as recently as 2007. But sales of the Tahoe were higher in October 2016 than at any point in the last nine years. October was just the seventh month in the last 106 that Tahoe volume climbed into five-digit territory.

So where’s our Buick Encounter?

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures. Follow on Twitter @goodcarbadcar and on Facebook.

[Image: General Motors]