U.S. Auto Sales, Q1 2019: Plenty of Red, Plus a Few Bright Spots
Talking heads have been warning for days that the auto industry should prepare itself for a rougher than usual ride in 2019, speculating that sales for the first quarter would be softer than what we’ve seen in past years.
This proved to be true, as players such as the Detroit Three, Nissan, Toyota, and Mazda all conspired to drag the industry down by just over three percent compared to this time last year. Fortunes were better at places like Kia, Hyundai, and Honda, each of whom recorded jumps in volume – two of them quite healthy.
A caveat, before diving into the numbers. You’ll recall that General Motors decided to stop releasing sales numbers on a monthly basis some time ago, shifting instead to a quarterly report. Ford followed suit and, in an infuriating turn, is not announcing its numbers until their Thursday earnings call. The stats here from the Blue Oval are sourced from Automotive News, who do not list the numbers as estimates.
Proving that it is tough to maintain a torrid sales streak, the almighty Jeep brand posted a double-digit dip in March, dropping 11.2 percent to 87,328 units. This number is nothing to sneeze at, and the brand isn’t in trouble by any stretch, but it does put an exclamation point on the stellar results it posted each month in 2018. Demand for the then-new JL Wrangler likely had a great deal to do with this. Ram continues to drive through walls, up 15.5 percent; producing both the new and old pickup side-by-side is paying dividends.
As a brand, Toyota was off by 3.5 percent, where a 1.5 percent rise in light truck volume was scuppered by a 14.2 percent drop in car sales.
“Light trucks and SUVs continue to lead the way for our industry, and Toyota’s Tacoma and RAV4 first-quarter sales results are a reflection of the strong consumer appeal of these vehicles,” said Jack Hollis, group vice president and general manager, Toyota division. In a poke at Ford, he went on to say “While some of our competitors are abandoning sedans, we remain optimistic about the future of the segment.”
I do love a good bit of OEM smacktalk. By the way, the old-as-rocks Tacoma continues to sell like proverbial hotcakes, posting its best-ever March and marking 17 consecutive months of year-over-year gains.
Nissan also posted a loss, with volumes of nameplates like the Titan and Rogue drying up to the tune of double digit drops. The former is likely due to decreased demand, now that some truck buyers who wanted the newly-redesigned Titan have gotten one, while the latter could be a victim of Nissan’s renewed effort to kick the fleet habit.
Meanwhile, Mitsubishi (yes, Mitsubishi) posted its best month since the halcyon days of The Fast and the Furious and underglow body kits. VW can boast of its 14 percent gain, achieved not just on the back of increased crossover/SUV sales but also on an eight percent jump in car volume as the snazzy new Jetta recorded an excellent month.
Pundits speculate that 2019 will see the industry drop below 17 million units for the first time since 2014. They’re probably not wrong. Average transaction price in March hovered around $36,700, which is a number driven by high-zoot pickups, unsurprisingly. The average rate on a new vehicle note was (gulp) 6.36 percent because, according to Edmunds, only four percent of deals last month had zero percent interest rates. Yikes.
Check back for further analysis later in the week.
[Image: Fiat Chrysler Automobiles]
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