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November Auto Sales: GM, Nissan, VW Rise as FCA Tumbles

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Truck Demand Helped Fuel Sales
Truck Demand Helped Fuel Sales
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Ford, Honda, Nissan, Toyota and General Motors posted U.S. sales increases in November as a rise in incentive spending helped put the industry back on a winning track after three straight monthly declines.

A 10% gain at GM and a 4.3% rise at Toyota Motor Corp. marked their strongest advances this year. Nissan Motor Co. climbed 7.5%, while Ford Motor Co. ended a four-month skid. The Volkswagen brand soared 24%. Fiat Chrysler was the exception among the first companies to report, tumbling 14% as fleet deliveries shrank.

The VW brand's 24% increase ended a streak of 12 consecutive monthly declines in the wake of the automaker's diesel-emissions scandal. VW's Audi, meanwhile, extended its winning run to 85 months with a 2.5% gain.

Continued demand for light trucks amid low gasoline prices helped boost automakers' results, as did two additional selling days compared with November of 2015. Incentive spending last month, including Thanksgiving holiday deals, was up 13% vs. a year-earlier but down from October, according to TrueCar data.

When other automakers release results later today, U.S. light-vehicle sales in November are forecast to rise about 3.8% from a year earlier, based on a survey of analysts by Bloomberg.

What's more, November is shaping up to leave the industry in a better position to top last year's 17.47 million tally. Sales through October were 0.3 % behind their year-earlier pace after three straight monthly declines.

If the industry manages to eke out an annual gain, 2016 would mark the first time in a century that U.S. sales topped year-earlier levels for seven straight years. Sales rose every year in a nine-year stretch through 1917.

Company by company

GM's 10% increase reflected rises of 8.1% at Chevrolet, 14% at GMC, 16% at Buick and 14% at Cadillac. GM said sales to retail customers were up 7.9% to 197,609 in November while rental shipments jumped 27%.

Toyota's corporate increase reflected a 5.3% gain at the Toyota division. Deliveries slipped 1% at Lexus. Toyota finally managed to outsell Ford Motor Co. after coming close twice this summer. Toyota's margin was 1,204 units to rank No. 2 in the industry, behind GM.

Ford posted a 5.1% rise in November volume. Sales rose 4.5% at the Ford division and 19% at Lincoln. Ford's retail sales were up 10% while fleet shipments dropped 9%.

Volume dropped at FCA on sharply lower fleet shipments, a 12% decline at Jeep and a 47% decrease at the Chrysler brand. It was the third straight monthly decline at Jeep. Deliveries rose 12% at Ram but slipped 21% at Dodge and 15% at Fiat. FCA said overall retail demand dropped 2% and fleet volume was off 42% last month.

Sales advanced 7.5% at Nissan Motor last month, with deliveries rising 8% at the Nissan division and 3.6% at Infiniti. Honda Motor Co. ended a three-month losing streak with a 6.5% increase. Honda division volume climbed 7.9%, offsetting a 5.1% decline at Acura.

Strong SAAR

The seasonally adjusted, annualized sales rate is projected to remain strong but drop to 17.7 million vehicles, according to a survey of analysts by Bloomberg. That would be down slightly from this year's highest rate -- October's 17.98 million -- and the 18.07 million pace in November 2015, the second-strongest month of last year. GM today estimated the November SAAR at 17.9 million units.

The early launch of Black Friday sales events helped offset declines in fleet sales in November, said Eric Lyman, TrueCar's chief industry analyst. "The retail sales environment remains strong for new car sales," Mr. Lyman said. "Incentives are also down slightly [from October] as automakers begin to address supply side imbalances with planned reductions in vehicle production."

Steady economic and job growth and the recent rise in U.S. equity prices have also encouraged consumers to make big-ticket purchases, analysts say. Incentive spending by automakers averaged an estimated $3,475 per vehicle in November, TrueCar estimates.

'Plateau'

Mike Jackson, CEO of AutoNation Inc., the largest U.S. new-vehicle dealership group, said there is some relief among dealers and automakers now that the presidential election, and the uncertainty that the campaign cast over consumers, is over.

"I still think we're in a plateau," Mr. Jackson said this week. "There is a point of diminishing returns when whatever you give at the front end in incentives comes off residual values at the back end. We're right at that tipping point."

Jessica Caldwell, an analyst for Edmunds.com, said luxury vehicles and light-truck demand in December will determine whether the industry hits a new milestone. "November sales have the industry well-positioned to set a new annual sales record this year, but a new record is far from guaranteed," said Ms. Caldwell. "Expect to see a flood of ads for holiday season sales events in the coming days and weeks, especially for luxury brands, trucks and SUVs. If we see any year-over-year lifts in these segments in December, then it's a good bet that the industry will top last year's record-high sales."

David Phillips is a reporter for Automotive News. Automotive News reporter Nick Bunkley contributed to this report.

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