Posts Tagged ‘auto incentives’

Some Up, Some Down as Automakers Report January Sales

Strong consumer confidence yields record for Hyundai, but numbers slump at GM, Ford and Toyota.

by on Feb.01, 2017

Dusting the competition: Ford was down overall, but had a spectacular month for F-Series.

After a robust finish to 2016, new vehicle sales slowed in January, though generally remained healthy enough overall to boost confidence for the coming year.

There has been concern within the industry that 2016 brought a peak to the automotive recovery, with analyst and industry planners watching to see if and when things would begin to cool off. The good news they got was that, with a few exceptions, the new car market appeared to do better than initially forecast – and not only were sales relatively solid but consumers continued buying more expensive products.

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The numbers were decidedly mixed, industry giants General Motors, Toyota and Ford all reporting year-over-year declines for January. But Nissan’s sales were up for the month, and a number of automakers scored new sales records, including Hyundai, Audi and Nissan’s luxury arm Infiniti. Auto industry analysts had been anticipating declines of anywhere from 0.7% to 2.7% — according to TrueCar and KelleyBlueBook, respectively. But even for many of those makers who did suffer sales dips in January, the news wasn’t all bad.

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Automakers Struggle as Small Car Sales Slide

Midsize models also taking a hit as cheap gas lures shoppers to SUVs and CUVs.

by on Apr.12, 2016

Dodge will now offer just 3 versions of the Dart.

Desperate to reverse declining sales of some of its smallest passenger cars, Fiat Chrysler Automobiles is trimming back the line-up of its compact Dodge Dart line and cutting as much as $1,600 off the sticker price of the three remaining models.

The Detroit maker isn’t alone. Across the industry, automakers are struggling to shore up demand for their sedans and coupes, especially the compact and smaller models that have been especially hard hit by the past year’s sharp dip in fuel prices.

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Manufacturers are ramping up incentives, trimming model lines and, in some cases, cutting production or moving it offshore in a bid to reduce production costs.

“We are repositioning the Dart lineup to better align production and dealer inventory with consumer demand and preference,” Tim Kuniskis, FCA’s head of passenger car brands.

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Makers Moved Metal by Offering Money

Incentives rose in June keeping the good times rolling.

by on Jul.01, 2015

Slow sales means big incentives on some vehicles, such as the Kia K900 which had $8,000 slapped on the hood to lure in buyers.

Automakers in the U.S. enjoyed a monumental month in June with double-digit sales increases seeming to be the norm as they reported the results.

The results were so positive at least one organization – the National Automobile Dealers Association – revised its expected sales number for 2015 upward to 17.2 million vehicles: a 200,000-unit jump.

Inside the Sales News!

In order to keep that smoking hot sales pace, some automakers sweetened the pot for certain buyers. Hyundai was the leader of the pack on increased incentive spending with a 34.5% jump over last June and 5.6% spike from May. (more…)

US Car Market Showing No Signs of Cooling Down

SUVs, crossovers and luxury vehicles drive demand.

by on Jul.28, 2014

Strong demand for products like Altima mean Nissan will deliver a double-digit July sales gain.

It may be an unexpectedly cool summer in much of the country but you wouldn’t know by looking at July’s sales numbers – which have many industry observers expecting the rest of the year to remain hot.

Mark Fields, Ford Motor Co. chief executive officer, noted the general economy appears steady, which should lead to strong sales during the second half of the years. Chuck Stevens, General Motors chief financial officer, also said the second half of the year looks very promising.

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Preliminary data suggest that July new-car sales will be up about 12% over year-earlier numbers, putting the industry on track for its best July since 2006, well before the U.S. economy began to collapse. Overall sales should reach about 1.46 million for the month, according to new forecasts from TrueCar and Kelly Blue Book, and that translates into a seasonally adjusted annual rate, or SAAR, of 16.6 million to 16.7 million, roughly a million ahead of total sales in 2013.

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May Could Bring Best Retail Car Sales in a Decade

Spending on new vehicles could set a new record for the month.

by on May.27, 2014

Big Memorial Day sales are expected to deliver strong numbers for May.

With automakers offering lavish sales for the Memorial Day weekend, industry-watchers are optimistic May will end on an upbeat note. But even before the annual holiday event, sales of new vehicles have been rocking along this month, with analysts predicting May will see a significant upturn from year-ago sales.

New light vehicle sales in the U.S. are expected to hit 1.52 million units, up 5.5% from May 2013 and a 9.5% increase from April 2014, according to TrueCar, which is predicting that the Seasonally Adjusted Annual Rate, or SAAR, will reach 16.1 million when the books are closed on May, a 6% year-over-year increase.

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Spring car sales generally are some of the year’s strongest, but industry observers are particularly relived considering the unexpectedly sharp slide in demand during this past, cold Winter.

“The industry is back to the level we expected at the beginning of the year,” said Larry Dominique, President of data tracking service ALG, and Executive Vice President of TrueCar.  “Chrysler, GM and Nissan are all benefiting from increased demand. They are showing higher sales and are able to pull back on incentive spending,” he added.

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New Car Sales Picking Up April Momentum

Warm weather, new products, rising consumer confidence are factors.

by on Apr.28, 2014

A flood of new products, like this Mercedes-Benz CLA45 AMG, has helped warm up the U.S. market after a cold winter.

As much of the country shakes off the winter doldrums and heads for what has traditionally been the year’s busiest season, sales of new cars, trucks and crossovers appear to be picking up some significant momentum.

After a frigid start to the New Year, demand has been heating up in April, according to a number of preliminary reports which see the warmer weather as one key factor – though buyers also are being lured back to showrooms by a flood of new products. And improved consumer confidence is helping, as well.

By the Numbers!

Sales appear to be heading for the 16 million mark on a Seasonally Adjusted Annual Rate, or SAAR, for April, according to new surveys. By comparison, the industry sold 15.5 million new vehicles for all of 2013. Meanwhile, J.D. Power & Associates estimates consumers will spend $33.5 billion purchasing new vehicles this month, a record for the month, topping the $30.5 billion motorists spent in April 2005.

“Auto sales are hitting their stride as the spring selling season begins, and the pace has returned to the level expected at this stage of the recovery,” said Jeff Schuster, senior vice president of forecasting at LMC Automotive.

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As Sales Slow, Automakers Could be Heading for Incentives War

Good news for consumers could be a disaster for industry’s bottom line.

by on Feb.12, 2014

GM's move to offer more than $7,000 in incentives on its 2014 Silverado has made investors nervous about a possible incentive war.

When General Motors announced it would offer more than $7,000 in discounts on some of its big Silverado pickups the news sent many shoppers rushing to showrooms – but it also sent shivers racing down the spines of automotive investors increasingly worried that slowing sales may trigger the sort of incentive wars that trashed industry profits during the years leading up to the recent recession.

All the ingredients are there for a classic price war, automotive analysts warn. January auto sales took a sharp dip that may have been impacted by more than just the cold weather gripping the nation. In turn, there are now a growing number of vehicles piling up on dealer lots across the country, a situation that may force manufacturers to sharply increase current rebates and other incentives.

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“Rising inventory levels combined with several more waves of bad weather will result in a short-term spike in incentives,” said Eric Lyman, vice president of Editorial and Consulting for ALG, formerly known as the Automotive Leasing Guide. “The danger is that this could be the beginning of an escalating arms race for market share.” (more…)

Automakers End 2013 With Best Sales in Six Years

Optimism is the word as 2014 gets underway.

by on Jan.03, 2014

It was another "best-selling" year for the F-150 as it again captured the title of best-selling vehicle in the U.S., helping Ford to a 2% sales increase in December.

With domestic and international brands reporting solid gains in December, new vehicle sales, like the stock market, finished 2013 on an upbeat note, creating optimism about the outlook for the year to come.

While a few manufacturers have yet to report in, the industry was on track to report its best sales numbers in six years, a welcome relief after the worst industry downturn since the Great Depression. A total of about 15.5 million vehicles were purchased by U.S. motorists in 2013, and forecasts for the coming year range from IHS Automotive’s conservative 16.1 million to as much as 16.5 million or more.

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Significantly, an assortment of manufacturers finished last year reporting all-time best numbers, a list that included imports such as Audi, Subaru, Hyundai and Kia. But at least a few automakers ended 2013 on a mixed note – Toyota, for one, reporting a 1.7% drop in December sales, though it was nonetheless up 7.4% for the year as a whole. (more…)

December Likely to Bring Record Spending on New Cars

Automakers offer tempting deals to draw in buyers.

by on Dec.23, 2013

A new Ford F-150 rolls off the maker's assembly line in Kansas City, Missouri. Strong pickup demand helped boost car sales in 2013.

With millions of dollars of television commercials airing this month and millions more in incentive money on the table, automakers are expected to end the year with a bang, sales expected to be up at least 4% from December 2012 – with the industry anticipating all-time record consumer spending.

While new-vehicle sales started off slowly in December, they are expected to finish strong at the end of the month, according to a monthly sales forecast developed jointly by J.D. Power and LMC Automotive.  That would be good news for industry planners worried about a recent bulge in dealer inventories that’s already led several manufacturers to trim back production.

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Consumers in the U.S. are expected to spend more than $34 billion on new vehicles in December, a historic high for the month. That reflects not just the end-of-year sales burst but also record transaction prices, according to the forecast. The optimism was reinforced by a new report from the U.S. Department of Commerce which indicated the U.S. economy was expanding more rapidly than first thought. The Commerce Department now estimates the U.S. economy grew by 4.1% during the third quarter.

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Auto Inventories Bulging – Will Makers Cut Production or Launch Price Wars?

Trouble for manufacturers could be good news for consumers.

by on Dec.11, 2013

Dealers are seeing a build-up of inventory despite strong U.S. car sales.

The nation may be in the grips of a continent-sized cold spell but automotive sales continue to run hot, as they have for much of the year.  Still, November’s unexpectedly strong numbers only barely conceal the fact that manufacturers may have gotten a bit too ambitious trying to take advantage of the best new car market since before the economy went into a nosedive six years ago.

While there are a handful of hot new models, like the 2014 Jeep Cherokee and the ’14 Chevrolet Corvette, that are flying off showrooms almost as fast as they’re delivered from the factories, dealers around the country are reporting bulging inventories of many other products, such as the Acura RLX and the Ford Fusion.

Dealer's Choice!

And that’s worrying industry planners and analysts alike.  In years past, the build-up would have been a recipe for trouble, makers playing a game of chicken by ramping up incentives to maintain sales and market share – even at the cost of profits. It was precisely that sort of strategy that helped nearly sink the Detroit Three as the U.S. auto market collapsed in 2009 and 2010.

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