Automakers trucks

With U.S. auto sales falling 2 percent through May and automakers trimming car production, one would think it’s time to avoid auto stocks.

That thinking might be flawed. The reason? Pickup trucks. Through May, pickup sales rose 4 percent, and sales generally are stronger in the second half.

Since Detroit automakers General Motors, Ford and Fiat Chrysler control more than 90 percent of the pickup market, and the U.S. accounts for a big chunk of their earnings, profits could rise even as overall sales slow.

Citi analyst Itay Michaeli says in a note to investors that pickup fundamentals have “a profound impact” on Detroit’s earnings. Plus, automakers have shown discipline on truck pricing “that might be getting overlooked.” The average price of a new pickup is $46,517, opposed to a full-sized car, which is $34,315*. Both are slightly down from a year earlier, according to Kelley Blue Book.

Overall industry sales likely have leveled off — some analysts have cut their sales forecasts to around 17.2 million from last year’s record of 17.5 million.

But sales of Ford’s F-Series big pickups are up 8.5 percent through May. Fiat Chrysler’s Ram is up almost 8 percent. Sales of the Chevrolet Silverado are down 4 percent, but GM says it’s getting significantly higher prices for the truck. Plus Chevy Colorado midsize pickup sales are up 29 percent.