Auto Sales Soar In September: Will This Uptrend Continue?

In the year so far, U.S. automakers notched up the best sales mark in September. Thankfully, they were able to reverse the downhill trend and recover from back-to-back natural calamities that dampened sales in major U.S. markets.

Per Autodata Corp., U.S. auto sales in September rose 6.1% year over year to 1.5 million units, primarily driven by a strong demand for pickup trucks, sport-utility vehicles and crossovers. This big gain in auto sales was mostly fuelled by rise in demand for full-size pickup trucks, comprising 84% of the total pickup truck market in the United States.

Good news is that heavy demand to replace damaged or destroyed vehicles due to the impact of Hurricanes Harvey and Irma has uplifted sales for the month. New 2017 model launches by a few companies also helped increasing the monthly sales.

General Motor Corporation (NYSE:GM) , Ford Motor Company (NYSE:F) , Volkswagen (DE:VOWG_p) AG (OTC:VLKAY) , Toyota Motor Corporation (NYSE:TM) , Honda Motor Company (NYSE:HMC) and Nissan Motor Co., Ltd. (OTC:NSANY) have posted sales improvement in September. Of major automakers, Fiat Chrysler Automobiles N.V. (NYSE:F) has however, reported a decline in sales.

Now let us take a look at the U.S. sales figures reported by individual automakers.

U.S. Automakers

General Motors recorded 279,397 vehicle sales in September, marking a 12% year-over-year rally. Further, retail sales were up 8%, while commercial deliveries surged 43%. This growth was driven by strong sales of new crossovers from Chevrolet, Buick, GMC and Cadillac. Also, the company expects to achieve the inventory target of about 850,000 vehicles by the year-end.

Ford reported an 8.7% boost in U.S. sales from the year-ago period to 222,248 vehicles this month. For the same time frame, retail sales went up 4.4% to 169,544 vehicles from the year-ago period. The company also witnessed an ascent in SUV sales, besides gaining from strong sales across retail, commercial and government.

European Automakers

Fiat Chrysler recorded a 10% year-over-year decline in sales to 174,266 vehicles in September. However, the retail sales, contributing 84% to total monthly sales, inched up 0.3% year over year to 146,904 units. Fleet sales plunged 41% to 27,362 units, in line with the company’s strategy to decrease daily rental segment.

Volkswagen recorded a 33.2% year-over-year improvement in sales to 32,112 units in September. Of the total sales under the Volkswagen brand, SUVs accounted for more than 26% of the total volume.

Japanese Automakers

Toyota’s sales went up 14.9% year over year to 226,632 units in September. Sales in the Toyota division shot up 16.9% to 200,436 units. The company’s light trucks segment continued to lead the total sales. RAV4, a compact sport utility vehicle witnessed a sale of 44% to 42,395 units and Highlander sales were up 36.6%.

Honda recorded a 6.8% year-over-year increase in sales to 142,722 vehicles in the month. Sales in the Honda Division also gained 7.4% to 129,776 units in September. Plus, sales of the Acura Division nudged up 1% to 12,946 vehicles.

Further, truck sales moved up 0.2% year over year to 60,369 units and the car sales rallied 14.5% to 69,407 units.

Nissan reported a 9.5% year-over-year growth in sales to 139,932 vehicles in September. Sales in the Nissan division also climbed 9.3% to 127,187 units. Plus, sales of the Infiniti Division rose 11.7% to 12,745 units.

Outlook

The after-effects of Harvey are expected to continue in the next few months, boosting retail light vehicle sales as in customers will be increasingly prompted to swap their dented vehicles with new ones. Also, new model launches and rise in pickup truck demand are projected to positively impact the sales.

However, in order to lure customers and clear prior inventories, auto manufacturers are offering heavy discounts, which might weigh heavily on their profit margins.

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