U.S. auto sales drop in June

DETROIT — Ford, General Motors, Fiat Chrysler and Hyundai all reported U.S. sales drops last month, apparently dragging the industry to its sixth straight month of declining numbers as auto sales slow from last year’s record pace.

Fiat Chrysler sales were down 7.4 per cent, while Ford said its sales declined 5.1 per cent. GM was off 4.7 per cent and Korean automaker Hyundai posted a hefty 19.2 per cent decrease. Toyota, Nissan and Honda each reported small gains.

If June sales fall as expected, sales for the first half of the year would be down for the first time since the financial crisis in 2009.

But Autotrader senior analyst Michelle Krebs said a small dip is not an indication of economic troubles since unemployment is low and consumer confidence remains high. She doesn’t expect a recovery in the second half of the year, but also doesn’t see a huge decline, predicting full-year sales from between 16.8 million to 17.3 million. That’s below last year’s record of 17.55 million.

“We think the second half could be a little bit stronger than the first half was,” says Krebs, who expects this year still to be the fifth-best year on record. “We don’t see any imbalances that suggest anything is going to collapse.”

Krebs says sales should remain healthy even though credit is tightening slightly and automakers are cutting back on sweet lease deals. “We’re down but not out,” she said.

Toyota reported a 2.1 per cent sales increase led by the RAV4 compact SUV, which was up nearly 25 per cent. Honda posted nearly a 1 per cent gain and Nissan sales were up 2 per cent. Volkswagen reported a 15 per cent increase over June of 2016 when sales were depressed due to the company’s diesel engine emissions-cheating scandal.

With few exceptions, U.S. buyers continued a trend they ’ve been following for years. They’re buying SUVs and trucks and shunning cars. Sales of Toyota’s Camry, normally the top-selling non-pickup truck in the U.S., fell nearly 10 per cent. But Ford’s F-Series pickup, the top-selling vehicle in America, rose nearly 10 per cent.

The shift is good news for companies that rely heavily on pickup trucks and SUVs such as Ford, GM and Fiat Chrysler.