Ford, Chrysler Expected to See Sales Fall Sharply in August

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Automakers will be reporting U.S. August new car sales Thursday, August 31, and analysts are looking for sales to break out of a seven-month streak of lower year-over-year sales. The good news is not spread evenly, however, with both Ford Motor Co. (NYSE: F) and Fiat Chrysler Automobiles NV (NYSE: FCAU) forecast to see sales decline

On an annualized basis, the seasonally adjusted annual rate (SAAR) of sales in August of last year was 16.7 million light vehicles (cars, pickups, and minivans). That number is forecast to decline to 16.6 million units this year by Kelley Blue Book ( KBB), J.D. Power/LMC Automotive, and Edmunds.

General Motors Co. (NYSE: GM) is expected to post a year-over-year sales gain in August — KBB estimates a rise of 6.1% and Edmunds is forecasting a gain of 1.9%. KBB forecasts unit sales at 272,000 and Edmunds has sales estimate of 261,183.

KBB projects Ford sales will decline by 3.5% to 206,000 units and that the company’s market share will drop by 0.7 of a point to 13.5%. Edmunds forecasts Ford sales of 208,231, down 2.4% year over year for August and a market share decline of half a point. The estimate from Edmunds calls for a sales decline of 4.7% to 187,472 units

Sales at FCA should also fall 3.5% according to KBB to a total of 190,000 units and the company’s market share should dip by 0.6 of a point. Edmunds has FCA sales pegged at 187,472, down 4.7% year over year. The company’s market share is expected to drop by 0.8 of a point.

Toyota Motor Corp. (NYSE: TM) is the big winner in unit sales for August, according to Edmunds. Sales are expected to rise 11.6% year over year and Toyota is expected to gain 1.4 points of market share to trail leader GM (17.1% share forecast ) in second place with a 15.6% share.

KBB expects Toyota to sell 227,000 units in August, up 6.3% compared with August 2016. Toyota’s market share is forecast at 14.8%, up 0.7 of a point.

Edmunds expects Honda Motor Co. Ltd. (NYSE: HMC) to sell 161,381 units in August, up 7.9% from last August’s total. Honda’s market share is forecast to rise from 9.9% a year ago to 10.6%.

The biggest loser in unit sales is Hyundai-Kia. Edmunds is forecasting a unit sales drop of 6.1% year over year and market share is forecast to drop from 8.4% last year to 7.8%. The outlook from KBB calls for unit sales of 120,000, down 5% year over year.

Both KBB and Edmunds see an uptick in Volkswagen/Audi sales to a range of 52,000 to 56,000 units, a gain of 4% to 7.2%.

J.D. Power/LMC also noted other auto market data points for August:

  • The average new-vehicle retail transaction price to date in August is $31,004, a record for the month, surpassing the previous high for the month of $30,971 set in August 2016.
  • Average incentive spending per unit to date in August is $3,805 per unit, a record for the month, and surpassing the previous high for the month of $3,645 set in August 2016. Spending on trucks and SUVs is $3,696, up $192 from last year. Spending on cars is $3,988, up $131.
  • Incentives as a percentage of MSRP are at 10.6% so far in August, exceeding the 10% level for 13th time in the past 14 months.
  • Trucks account for 63.2% of new-vehicle retail sales through Aug. 20—the highest level ever for the month of August—making it the 14th consecutive month above 60%.
  • Days to turn, the average number of days a new vehicle sits on a dealer lot before being sold to a retail customer, is 74 through Aug. 13. This is the highest level since July 2009 (80 days).