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2018-01-04 08:58

BIG CARS UNDER PRESSURE IN US: This file photo taken on November 30, 2017 shows Motor Trend magazine's 2018 Tuck of the Year, the Ford F150 Lariat Truck at the 2017 LA Auto Show in Los Angeles, California. Image: Fred Brown

New York - Automakers were on track Wednesday to report the first annual decline in US sales since the financial crisis, a dip offset by continued strength in the sales of trucks and other large vehicles.

The three leaders in the US market - General Motors, Ford and Toyota - all reported modest declines Wednesday in annual sales compared with 2016, a record-setting year for the auto industry.

But the US auto industry's eight-year streak of increasing sales since 2009 looked almost certain to be broken, based on figures released by leading automakers Wednesday ahead of aggregated sales data later in the day.

The winning streak "was the result of pent-up demand after the recession that's finally just running out," said Tim Fleming, an analyst at Kelley Blue Book, which had forecast total US sales of 17.1-million, down from 17.6-million in 2016.

Top selling vehicles in the US: Vehicle, sales and percent change from 2016

Ford F-Series 896 764 +9.3%
Chevrolet Silverado 585 864 +1.9%
Ram pickup 500 723 +2.3%
Toyota RAV4 407 594 +15.7%
Nissan Rogue 403 465 +22.3%
Toyota Camry 387 081 -0.4%
Honda CR-V 377 895 +5.8%
Honda Civic 377 286 +2.8%
Honda Accord 322 655 -6.5%
Toyota Corolla 308 695 -14.4%

Automakers had also been bracing for a possible ebbing of sales the last couple of years, an outcome averted in 2016 in part by heavy incentives late in the year to unload excess inventory.

Analysts note that annual sales above 17-million is still very strong.

What's more, the US auto industry continues to enjoy strong demand for larger vehicles, a group that includes SUVs, pickup trucks and "crossover" models.

Larger vehicles are grabbing even more market share from sedans, which are estimated by Kelley to have accounted for just 36% of the US market in 2017, down from 50% in 2012.

GM's annual sales fell 1.3% to 3-million, but the biggest US automaker said continued strength in larger crossover vehicles and trucks had helped it lift the average retail price for all vehicles to $35 400 in the final month of the year, a record.

Ford's sales fell 1.1% to 2.6-million for the year compared to 2016, but it reported a surprise increase in December 2017 sales, fueled in part by the continued success of the F-Series pickups and other large vehicles.

The average price of best-selling F-Series came in at $47 800, a new record, marking an "unbelievable year" for the model, Ford Vice President Mark LaNeve said.

Toyota, meanwhile, reported a 0.6% decline in US sales at 2.4-million, pointing to strength in its popular Camry sedan, its RAV4 crossover and SUVs.

Fiat Chrysler's December sales fell 11%to 171 946, a bit below the level projected by Edmunds, but above the forecast by Kelley Blue Book. The figures were hit by lower sales to car rental companies. FCA did not release year-end figures.

Honda's US sales rose 0.2% for the year to 1.6-million. Nissan's 2017 sales also came in at 1.6-million, up 1.9% from the prior year.

Bullish on 2018?

Some in the auto world remain bullish about 2018, pointing to the benefits from the US tax cut law signed into law last month by President Donald Trump.

"In 2017, we had solid GDP growth and good news on employment, wages and consumer sentiment, which helped deliver very strong retail sales for the auto industry," GM chief economist Mustafa Mohatarem said.

"This year, many consumers will see their take-home pay rise because of tax reform. That will keep the broad economy growing, and help keep sales at very healthy levels even as the Fed increases interest rates."

Countering that trend, analysts say, are interest rate increases by the Federal Reserve that will boost lending costs on consumers.

Fleming of Kelley Blue Book also pointed to an expected influx of vehicles leased during the financial crisis and its aftermath that will enter the used market, depressing demand throughout the industry

"The numbers point to further decline," said Fleming, who is projecting 16.7-million vehicle sales this year.

Read more on:    united states  |  car sales

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