United States May auto sales likely to beat fore­casts

The China Post - - WORLD BUSINESS - BY DEE-ANN DURBIN

U.S. auto sales were stronger than ex­pected in May, boosted by Me­mo­rial Day pro­mo­tions and strong de­mand for new SUVs.

An­a­lysts had ex­pected sales to fall by around 1 per­cent, but Tues­day’s sales re­ports were beat­ing their ex­pec­ta­tions. Ford said over­all sales likely grew around 1 per­cent over last May.

Gen­eral Mo­tors’ sales rose 3 per­cent, Fiat Chrysler’s sales rose 4 per­cent and Honda’s were up 1 per­cent. All three au­tomak­ers ben­e­fited as buy­ers con­tin­ued a steady shift from cars into small and medium-sized SUVs. In the first two weeks it was on sale, Honda sold more than 6,300 HR-V small SUVs. Sales of the Jeep Chero­kee SUV were up 23 per­cent, while sales of the GMC Aca­dia jumped 67 per­cent.

Volk­swa­gen sur­prised with an 8 per­cent sales gain. Ford’s sales fell 1 per­cent and Toy­ota’s sales were flat.

May is typ­i­cally one of the big­gest sales months of the year, as buy­ers flush with tax re­turns look for­ward to sum­mer road trips. Last May, sales jumped 11 per­cent to 1.6 mil­lion, their high­est monthly to­tal in nine years.

Af­ter five years of blis­ter­ing growth af­ter the re­ces­sion, it’s get­ting in­creas­ingly dif­fi­cult for the in­dus­try to match those kinds of num­bers. U.S. sales are ex­pected to hit 17 mil­lion this year, near their his­toric peak of a decade ago, and au­tomak­ers will have to work harder to post big gains.

But the in­dus­try isn’t alarmed. Be­cause of fac­tory clo­sures dur­ing the re­ces­sion, out­put is closer to match­ing con­sumer de­mand, so car com­pa­nies don’t have to re­sort to as much ex­pen­sive dis­count­ing as they did in the past. De­mand is also healthy thanks to eas­ing credit stan­dards, im­prov- ing em­ploy­ment num­bers, lower gas prices and en­tic­ing new ve­hi­cles.

In a sign of con­fi­dence, Ford is short­en­ing its an­nual two-week sum­mer break to one week at its six North Amer­i­can as­sem­bly plants, and FCA can­celed its usual shut­down at four as­sem­bly plants in the U.S. and Mex­ico.

An­a­lysts had fore­cast that lower sales to rental car com­pa­nies and other fleets would drag down sales. But car buy­ing site TrueCar. com said sales to in­di­vid­ual buy­ers jumped 7 per­cent over Me­mo­rial Day week­end, thanks in part to pro­mo­tions like zero-per­cent fi­nanc­ing on the new Hyundai Sonata sedan.

GM’s sales rose 3 per­cent to 293,097 ve­hi­cles. Sales of its best­seller, the Chevrolet Sil­ver­ado pickup, rose 11 per­cent, and Buick’s two small SUVs — the En­core and En­clave — both saw 20 per­cent gains. But car sales were weaker. Sales of the Chevrolet Cruze dropped 27 per­cent.

Ford’s sales dropped 1 per­cent to 250,813 ve­hi­cles. Sales of its best- seller, the F- 150 pickup, dropped 10 per­cent as the com­pany con­tin­ued to ramp up pro­duc­tion of the newly re­designed truck. Ford’s U. S. sales chief, Mark LaNeve, said Ford had just half of its nor­mal F-150 in­ven­tory at the be­gin­ning of the month. Ford also saw lower sales of the Es­cape and Ex­plorer SUVs.

Toy­ota’s sales were flat at 242,579. Toy­ota’s SUV sales were up, led by the High­lander with a 25-per­cent in­crease. Lexus SUV sales were also strong thanks in part to the new NX small SUV. But Toy­ota’s car sales dropped 11 per­cent.

FCA’s sales rose 4 per­cent to 202,227 ve­hi­cles, the com­pany’s best May since 2005. Jeep sales rose 13 per­cent. Sales of FCA’s best-seller, the Ram pickup, rose 8 per­cent, while sales of Ram’s ProMaster van more than dou­bled.

Honda’s sales rose 1 per­cent to 154,593 ve­hi­cles. Car sales were weak; Honda’s best-seller, the Civic sedan, was down 4.5 per­cent. But sales of the Acura RDX SUV jumped 24 per­cent.

Volk­swa­gen’s sales rose 8 per­cent to 34,758 thanks to sales of the new Golf small car, which nearly tripled over last May.

AP

In this Nov. 19, 2014 file photo, the 2016 Honda HR-V cross­over is un­veiled at the Los An­ge­les Auto Show, in Los An­ge­les.

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