Probably all of us know that the US automobile sector struggled to maintain sales momentum in August. Despite the fact that July was surprisingly robust, the industry recorded a major decline of 4.1% last month. Many automakers claim that they have reached a peak in demand. They also reported that they sold fewer vehicles, as reduced discounting kept customers from showrooms. The upside is that because everybody was counting on a small recession in the auto industry, stocks remained flat. This is also good news for the customers, who can expect sweeter deals, as incentives will be needed to shift existing stockpiles.
The biggest US automaker, General Motors, says it expects a 3% annual decline, while others hint at 5% decline. GM also reported an eight percent sales decline compared to August, 2015. While August sales of passenger cars fell from 687,998 last August to 600,983 this year, demand for light trucks actually rose from 889,409 to 911,573. We guess that without the trucks, people might have panicked, as regular cars dragged 13%. Volvo also shocked everybody by reporting a 31% increase in August, thanks mainly to the XC90 that managed to become a very popular model. Among the three major US automakers, Fiat Chrysler Automobiles, General Motors and Ford all posted year-on-year losses of 2.4%, 5.2%, and 8.8%, respectively. It's a similar story with Japanese automakers like Nissan (-6.5%), Toyota (-5%) and Honda (-3.8%). The picture looks bleaker if we only look at their passenger vehicles. Toyota car sales fell 12.5%, Honda car sales declined 11%, and Nissan car sales plunged 24.6%.
In fact, crossovers and SUVs are doing well, while all mid-size sedans were hit hard. Models like the Nissan Rogue, Ford Escape, and Toyota RAV4 all posted double-digit increases. It has also been reported that automakers boosted incentives by 7.7% in August, reaching levels that weren't seen for many years: $3331 per vehicle. The seasonally adjusted annual sales pace was 17 million units, also below last year's pace at this time. The average vehicle price had already gone up 2.5 percent in July, compared to the year-ago period, to $34,264.
