More Consolidation in the Oil Patch; Auto Sales 

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Another all-stock acquisition in the Permian Basin continues last year’s consolidation flurry of mergers in the oil patch. We’ll also check out 2023 new car sales from U.S. automakers, most of which reported sales totals on Wednesday.

APA to acquire Callon

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Pump jack in the Permian Basin.

APA Corp. (NASDAQ: APA) announced Thursday morning that it has agreed to acquire Callon Petroleum Co. (NYSE: CPE) in an all-stock deal valued at around $4.5 billion. Callon shareholders will receive 1.0425 shares of APA stock for each share of Callon stock they own. That works out to a premium of around 13.8%.

Callon’s daily production totals about 311 million barrels of oil equivalent, an increase of 48% to APA’s current daily production. As a percentage of total production in the Permian Basin, APA’s share rises from 37% to 43%.

This won’t change the game much compared to Chevron’s $53 billion acquisition of Hess and Exxon Mobil’s $59.5 billion deal for Pioneer Natural Resources. But it does put APA to survive until it gets an acquisition offer somewhere down the line.

APA stock traded down about 4.6% in Thursday’s premarket session at around $35 and Callon stock traded up by about 5.6% at about $35.50.

2023 new car sales and 2024 forecast

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Ford F-Series pickups.

After a disappointing 2022, automakers mostly had a good year in 2023. Sales of new cars rose 15.5% year over year, according to Wards Intelligence.

Looking ahead to 2024, Cox Automotive has forecast sales of 15.6 million new vehicles, a very modest increase but better than the drop to fewer than 14 million new car sales in 2022.

In 2023, General Motors Co. (NYSE: GM) sold 2.59 million vehicles. Its best-sellers were its full-size Silverado pickup trucks, with total sales of more than 555,000 units, an increase of 6.1% year over year. (The list of bestselling GM vehicles of all time is full of surprises.)

Jeep and Ram maker Stellantis N.V. (NYSE: STLA) reported a sales decline of 1% for 2023. The company sold a total of 1.53 million units last year. Jeep sales fell 6%, with the largest declines in sales of the Cherokee (down 39%) and Wrangler (down 29%) year over year.

Toyota Motor Corp. (NYSE: TM) reported 2023 new vehicle sales totaling 2.25 million units, up 6.6% year over year. Fourth-quarter sales were up 15.4%, and December sales were up 25.5%. Toyota’s legendary Camry saw sales drop 1.5% last year to just over 290,000 units. The smaller Corolla had a sales increase of 4.6% to more than 232,000 units. The RAV4 SUV got a sales boost of 8.8% to nearly 435,000 units and its full-size Tundra pickup sold 125,000 units, a jump of 20% year over year.

Ford Motor Co. (NYSE: F) reported 2023 sales just minutes before U.S. markets opened for regular trading Thursday morning. The company sold 2 million vehicles last year, an increase of 7.1% over 2022 sales. The F-Series of pickups were once again Ford’s best-seller, with more than 750,000 sold last year, up 14.8% year over year.

Sales topped 1.3 million vehicles for Honda Motor Co. Ltd. (NYSE: HMC) last year, an increase of 31.9% compared to 2022. The company’s truck sales, including its CR-V and other SUVs, had a sales boost of 30.7%. Honda’s Acura division posted a sales jump of more than 42% to 145,655 units for the year.

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