Americans are still ditching cars, but industry is healthy
Americans continued to abandon passenger cars in November, transitioning rapidly into crossovers, SUVs and pickups as automakers increasingly catered their products to shifting driver preferences.
Automakers sold slightly fewer vehicles overall in November, compared with last year, according to analysts’ forecasts, including one from Edmunds.com, which projected auto sales fell 1.3 percent last month, and Cox Automotive, which predicted a 2.6 percent decline.
Part of the decline may be because of rising interest rates, which are making car payments more expensive. But much of the fall is due to the plunging popularity of passenger cars.
Still, the industry remains healthy.
In fact, IHS Markit forecaster Christopher Hopson projected that full-year 2018 auto sales “will be very close to exceeding” 2017’s mark of 17.2 million, which was down from 2016’s all-time high of 17.6 million.
“The industry in November had a really steady, consistent performance, much in the range it has run in all year,” Ford U.S. sales and marketing chief Mark LaNeve said.
One consistent trend is fading demand for cars. Sales of compacts fell 18.4 percent in November and sales of midsize cars declined 15 percent, according to Cox Automotive.
But sales of compact SUVs and crossovers rose 11.6 percent and sales of midsize SUVs and crossovers increased 11.7 percent.
The trend is driving significant changes. General Motors announced last week that it would end sales of most of its passenger cars in the U.S., including the Chevrolet Cruze, Impala and Volt.
Ford Motor also announced this year that it would end sales of most of its passenger cars, including the Fiesta, Fusion and Taurus. And Fiat Chrysler was ahead of both GM and Ford by announcing years ago that it would get out of the small-car segment.
Other automakers have so far remained committed to passenger cars, even as they boost their own SUVs, crossovers and pickups.
But they’re not immune to the weakness in car sales. At Honda, for example, November sales fell 9.5 percent, including a 12.6 percent decline in cars.
And at Toyota, car sales declined 17.3 percent, including sharp drops for the Camry and Prius. Overall, Toyota’s sales were down 0.6 percent.
Ford’s sales fell 6.9 percent, hurt by declining passenger cars, and Fiat Chrysler’s sales rose 17 percent, powered by Jeep’s strong performance and increased sales to fleet customers. General Motors no longer reports monthly sales, but Edmunds and Cox Automotive forecasters predicted GM sales fell 2.5 percent and 4.2 percent, respectively.