GO
Loading...

UPDATE 2-Bad weather blamed for sagging U.S. January auto sales

Ben Klayman and Bernie Woodall
Monday, 3 Feb 2014 | 12:39 PM ET

DETROIT, Feb 3 (Reuters) - The top three U.S. sellers blamed extreme weather for poorer-than-expected auto sales in January, as analysts predicted a rebound in February and March. U.S. automakers Ford Motor Co and General Motors Co and Japan's Toyota Motor Sales USA saw January auto sales plummet, missing analysts' estimates for the month. But early sales results were mixed for other companies and brands, with Chrysler Group, a unit of Fiat Chrysler Automobiles , and Nissan North America reporting increases and topping analysts' estimates. "The bad weather only seemed to affect our competitors' stores," teased Chrysler as it reported double-digit sales increases for its Jeep and Ram truck brands. While snow and bone-chilling weather likely hurt total U.S. auto sales for the month, analysts said any dip in January sales shouldn't cut into the industry's months' long rebound, which has been outpacing the recovery of the overall U.S. economy since the 2008-2010 downturn. "The weather's an easy scapegoat -- it will be interesting to watch February and March to see if those lost sales in January get made up," said Larry Dominique, executive vice president at industry researcher TrueCar. Morgan Stanley estimated industry sales in January were at a seasonally adjusted annual rate of 15.3 million, well below analysts' consensus of 15.7 million. With companies representing about 75 percent of the industry total reporting early Monday, sales were down about 4 percent from the previous year. There was little consistency in the initial January sales reports. "It's tough to make any declarative statement" about the disparity in automakers' sales performances, said Gabelli & Co analyst Brian Sponheimer. "It's really hard to pull anything out of January that's trend-worthy." Ford said company sales fell 7.1 percent to 154,644. Analysts polled by Reuters had projected 157,441. Ford brand sales dropped 8.4 percent, with declines in such popular models as the Fusion mid-size sedan and the F-Series full-size pickup. But Lincoln brand sales jumped 42.5 percent, on the strength of the MKZ sedan and the MKX crossover. GM sales dropped 11.9 percent to 171,486, compared with analysts' average projection of 187,782. All four of GM's U.S. brands saw January sales decline. Toyota's January sales fell 7.2 percent to 146,365, missing analysts' estimate of 153,003. Bucking the downward trend, Chrysler Group's U.S. January sales rose 8 percent to 127,183, bolstered by increases at its Jeep and Ram truck brands. Among its best-sellers in January was the new 2014 Jeep Cherokee. Sales of the full-size Ram pickup jumped 22 percent, while most rivals in the truck segment reported year-to-year declines. Several analysts observed that full-size pickup pricing is improving with Ford and GM trimming incentive spending on big pickups and selling a richer mix of high-margin truck models. Kelley Blue Book, an industry research firm, said average transaction prices on all models in January rose 3.5 percent at Ford, 2.1 percent at GM and 3.4 percent at Chrysler. Ford, however, continued to spend heavily on other models, boosting total incentives by 14.6 percent from a year ago, according to TrueCar. In comparison, total incentive spending fell 19.6 percent at Chrysler and 3.6 percent at GM, TrueCar estimated. Among the smaller players, Nissan said sales climbed 11.8 percent to 90,470, above analysts' consensus estimate of 88,744. Sales were driven in part by the Altima mid-size sedan, which beat the Ford Fusion and sold twice as many as the Chevrolet Malibu. Volkswagen of America saw January sales plunge 19.0 percent to 23,494, as its three top sellers -- the Golf and Jetta compacts and the mid-size Passat sedan -- all fell from a year earlier. VW's premium Audi brand said sales remained relatively flat, at 10,101. Korean automaker Hyundai Motor Co said January sales rose slightly to 44,005.