By on June 28, 2017

2016 Chevrolet Corvette Bowling Green Assembly Plant - Image: GMGeneral Motors no longer expects the U.S. auto industry to collect more than 17.5 million new vehicle sales in 2017.

GM’s chief financial officer, Chuck Stevens, revisited the automaker’s U.S. sales forecast and turned the wick down from the mid-17-million-unit range, according to Automotive News, to the low-17-million-unit range.

That’s not a low number. In fact, 2017’s reduction of some 300,000 sales across the industry, year-over-year, would produce the second-best year for auto sales since 2001.

But reduced demand is complicating matters for the entire industry, most particularly for large automakers with excessive inventory.

Heading into 2017, General Motors had a reasonable 71 days of supply, but that figure ballooned to 107 days by the end of January and was still at 97 days at the end of the first-quarter.

At the beginning of June, General Motors’ supply ran to 101 days as the company seeks to dramatically reduce fleet sales and maintain a reasonably strict on incentives.

But General Motors is feeling the pressure.

High-profile cars are struggling.

The Chevrolet Malibu, a star for GM in 2016, is down 30 percent this year.

The Chevrolet Impala, after plunging below 100,000 annual sales in 2016 for the first time since 1999, is down by more than a third through 2017’s first five months.

At Buick, with the Verano (formerly Buick’s top-selling car nameplate before being discontinued) car sales are down 41 percent as the new LaCrosse fails to pick up any steam.

Cadillac, meanwhile, has suffered a 14-percent drop in car sales despite the addition of the CT6, new at this time last year.

Traditionally able to rely on truck strength when cars faded, General Motors has also seen pickup sales decline in early 2017. Through May, GM’s truck quartet is down 6 percent thanks to decreases from all four nameplates. That’s a loss of more than 20,000 sales.

In this environment, it’s not surprising to see GM’s Stevens tell analysts, “Pricing is more challenging.”

Nevertheless, GM will stick with its disciplined approach, Stevens says, and will attempt to fulfill its goal of dropping inventory to 70-days’ supply by year-end.

According to ALG, GM’s average transaction prices in May 2017 were 12 percent higher than the industry average. GM’s average incentive spend per vehicle as a percentage of the average transaction price, however, was also 12 percent higher than the industry average.

[Image: General Motors]

Timothy Cain is a contributing analyst at The Truth About Cars and and the founder and former editor of Follow on Twitter @timcaincars.

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14 Comments on “General Motors’ 2017 U.S. Auto Sales Forecast Adjusted (Downward)...”

  • avatar

    Maybe GM can keep a few more employees around by making manual transmissions for BMW.

  • avatar

    Maybe if GM made more competitive/higher quality vehicles they wouldn’t be reporting sales declines.

    How many GM vehicles are best in class?

    • 0 avatar

      Not many are #1 but most of them consistently rank #2 or #3 among their competitors or top 5 in large groups (looking at you Cruze and Equinox).

      Their sales are going down but it’s like the article says, they’re trying to pull out of fleet sales.

      All 4 brands seem to be finding their identities and markets still but the products are good

      • 0 avatar

        Sure I agree, but I’ve heard the “profits before market share” realigning to consumer demand stories many times from GM.

        My point is that in a year with 17+ million sales and a market moving towards trucks, there is literally no excuse not to be doing well.

        I think GM will weather the next down turn ok, but as the 4th largest global automaker, if they don’t start beating the competition in at least several segments, then their long-term future doesn’t look to bright.

    • 0 avatar

      What an interesting question from an established expert on General Motors’ products.

  • avatar

    This is the Mary Bara era of GM where profitability takes precedence over everything. This would be fine if sales and stock prices are up. However, GM’s market share is still declining. There is no running away from North America and Bara’s flawed strategy will be exposed for all to see. What surprises me is that GM is still ahead of Toyota in America despite GM’s low car sales.

    • 0 avatar

      Toyota isn’t doing that well either. When the whole market drifts down, it takes nearly every automaker with it. We’ll be debating who is doing best adjusting to a shrinking market for the next 3-4 years, I suspect.

    • 0 avatar

      how can anyone take your trolling seriously when you steadfastly refuse to even spell her name correctly?

  • avatar

    It’s a natural downturn. The automakers sold a [email protected] ton of cars the last 4-5 years. Less people need new cars right this minute. At least the ones that can afford new cars.

  • avatar

    I lay the blame squarely on the real people not actors ad campaign.

    • 0 avatar

      Those are super grating, for sure. I also find a $25,000 Chevy Cruze super grating, but I suppose that’s par for the course these days. New cars have got to be crazy expensive.

      • 0 avatar

        I never cease to be amazed that there are still people who don’t understand adding options to a car raises its price.

        • 0 avatar

          The marketing is brilliant. Apart from cost of production which is a state secret, the base car is X. They know how much they can up sell from X, be it a Ford Fiesta or a Porsche 911. We laugh at the porsche option sheet, but it works….even if the options work out to more than another Fiesta. Marketing basic transportation to Fiesta guy, vs. marketing a toy to Porsche Guy…

          I would love to read the marketing archives of the big 3….who buys, at what price, how much you can upsell, is fascinating.

          Wikileaks never brings me anything I care about, though….

  • avatar

    I can remember when anything over 16 million units was a good year.

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