US in March auto sales lag market expectations
Carmakers shares drop
DETROIT, April 3, (RTRS): Major US automakers on Monday posted sales figures for March that came in below market expectations and heightened concerns the country’s boom in vehicle sales may be losing steam, sending shares in car companies down.
General Motors Co and Fiat Chrysler Automobiles NV shares both fell almost 4 percent, while Ford Motor Co was off 3 percent.
Also of concern for the market was that inventory levels and consumer discounts have continued to rise as automakers have had to push harder to sell their products. A pricing war in the market could undermine automakers’ profits.
March “was a tough, tough, tough market,” said Judy Wheeler, vice president of US sales at Nissan Motor Co Ltd, which reported a 3.2 percent increase in sales for the month. “It’s going to be an aggressive year and I think everybody realizes that.”
Wheeler said Nissan’s internal data showed consumer discounts were $441 higher per vehicle than a year ago and inventory levels were on the rise.
Nissan trucks, SUVs and crossovers were up 26 percent and had hit record highs, especially its high-selling Rogue crossover.
Car sales in America have risen since end of the Great Recession and hit a record last year of 17.55 million. Investors and analysts have been watching for signs that the current boom cycle has begun to wane.
Trucks and SUVs pushed sales at some major automakers higher in March at the expense of cars as American
Continued from Page 30 Held under the theme ‘International Investment, Path to Competitiveness & Development’, this year’s edition of AIM has been discussing economic development opportunities and counter challenges. The international forum is host to 100 high-level officials, 500 exhibitors and more than 100 media partners.
As part of the Annual Investment Meeting (AIM 2017) being held at the World Trade Center in Dubai, World Bank Group (WBG) issued today (Monday, 3rd April, 2017), a global report discussing the relevance of foreign direct investments (FDI) across the world.
The new report presented ideas and explanations on the best methods to achieve sustainable development through foreign direct investment (FDI) at a time it is considered as a vital source for sustainable development.
The report emphasised three fundamental propositions that policy makers should keep in mind when defining a modern investment vision for development in the era of globalisation. The first proposition highlighted that investment policy and development is about connecting foreign and domestic investments. The second, proposition focused on investments, and in particular foreign direct investment (FDI), which are not homogenous phenomena. The third proposition sheds light on how investments are more than just transactions, entailing multi-staged relationships among different stakeholders. consumers continued to shun smaller vehicles amid low gasoline prices.
No. 1 US automaker General Motors Co reported a 2 percent increase in sales to just over 256,000 vehicles, with sales of its Tahoe and Suburban SUV models seeing their best sales month since 2008.
But sales at Ford Motor Co fell more than 7 percent to 236,000 vehicles, with fleet sales to rental agencies, businesses and government entities down nearly 17 percent on the year. Sales of Ford’s FSeries pickup trucks rose 10 percent on the year.
The F-Series has been the best-selling model in the United States since 1982. The full-size pickup truck is a key profit generator for the No. 2 US automaker.
On a conference call, Ford executives said they expected the seasonally adjusted annualized rate (SAAR) for US auto sales of over 17 million vehicles.
Analyst polled by Reuters expected a SAAR of 17.3 million vehicles for March.
Toyota Motor Corp reported a 2.1 percent decrease in sales, including a decline of more than 7 percent at its luxury Lexus brand. Fiat Chrysler said its sales were down 5 percent on the year, though sales of its popular Ram pickup were up 6 percent.
Honda Motor Co Ltd reported an overall decline in sales of 0.7 percent versus March 2016, but said truck sales were up 8.4 percent.
GM shares were down 3.8 percent at $34.03 and Ford was off 3 percent at $11.29. Fiat Chrysler shares were down 5.9 percent in New York trading at $10.28.
The report also emphasised that different types of FDI generate different kinds of jobs and thus have a different impact on the development of the local economy. In addition, the report quoted a UNCTAD (United Nations Conference on Trade and Development) study which revealed that FDI flows to developing economies reached record levels at $681 billion in 2014 with a total FDI stock in developing countries exceeding $8.3 trillion. It said that UNCTAD research shows that FDI can trigger multiple direct and indirect benefits in a host country, most importantly the transfer of new technology, managerial capabilities and increased productivity, although these benefits don’t materialise automatically. The WBG report stressed that in order to achieve economic and job growth, it is crucial that Domestic Value-Added (DVA) is increased on a competitive basis.
The report concluded with a note stating that the World Bank Group is currently assisting over 80 countries with framing their investment reform proposals and improving their investment competitiveness. In addition it highlighted the significance of different types of FDI, which can generate varied economic, social and other benefits for a country in the short and long-term. It also stressed the importance of having a sophisticated framework good enough to differentiate between the various kinds of FDI and their potential challenges and benefits for development, while being simple enough to enable governments to clearly start organising and prioritising the multiple and complex variables affecting the maximization of benefits of investment.