Cold Weather Hits Jan U.S. Auto Sales - Analyst Blog
February 04 2014 - 3:52PM
Zacks
Although auto sales usually remain low in January, extremely
cold weather further dampened the U.S. auto sales in Jan, 2014.
Sales during the month declined 3% from the year-ago level to 1.01
million. Sales on a seasonally adjusted annualized rate (SAAR)
basis remained in line with the year-ago level of 15.2 million
units in Jan, 2014.
Most large automakers like Ford Motor Co. (F),
Honda Motor Co., Ltd. (HMC), General
Motors Company (GM) and Toyota Motor
Corp. (TM) witnessed a year-on-year dip. However, Chrysler
and Nissan Motor Co. Ltd. (NSANY)
reported increase in sales in Jan, 2014. Nissan led in terms of
year-over-year increase in sales, while General Motors witnessed
the maximum slump.
Let's look at the U.S. sales figures reported by the individual
automakers.
U.S. Automakers
General Motors recorded 171,486 vehicle sales in January,
declining 12% year over year. Retail sales decreased 10%, while
fleet sales declined 18%. The company is set to launch many
vehicles in 2014, including the Chevrolet City Express small van,
the Chevrolet Colorado, the GMC Canyon, the revamped Cadillac
Escalade and the ELR. These additions are likely to improve sales
in the coming months.
Ford reported a 7% decline in total sales from the year-ago
period, to 154,644 vehicles in Jan, 2014. Retail sales fell 5% year
over year to 113,721 units. Fleet sales plunged 15% as the company
faced problems in delivering vehicles on time due to bad
weather.
Chrysler Group – controlled by Italy’s Fiat
S.p.A (FIATY) – recorded an 8% year-over-year rise in
sales, bringing the figure to 127,183 vehicles. Chrysler witnessed
year-over-year increase in monthly sales for 46 consecutive months.
Moreover, this is the best January sales for the group since
2008.
Japanese Automakers
Toyota’s sales declined 7.2% year over year on both volume and
daily selling rate (DSR) basis to 146,365 units in Jan, 2014. Sales
in the Toyota division deteriorated 9% based on both volume and DSR
to 128,728 units. However, Lexus sales rose 8.8% on both DSR and
volume basis to 17,637 units.
Honda recorded a 2.1% year-over-year decrease in sales on DSR
and volume basis to 91,631 vehicles in Jan, 2014. Decline in sales
in the Honda Division offset the 14.1% surge in sales of the Acura
Division.
Nissan Motor posted an 11.8% year-over-year increase in sales to
90,470 vehicles in January. Sales in the Nissan division also
climbed 10.4% to 81,472 units. Even the sales of the Infiniti
Division hiked 26.3% to 8,998 units in the month.
Outlook
The cold weather in December became worse in January, leading to
another weak month for the U.S. auto sales. As a result, sales are
expected to be strong in February, provided weather conditions
improve.
Further, the outlook for 2014 appears strong. In the long term,
sales are expected to rise on the back of strong pent-up demand,
easier car financing and low gas prices. Additionally, improving
macroeconomic conditions such as low interest rates, reduced
unemployment rates and recovery of the housing market are likely to
boost sales. These catalysts are expected to drive the U.S. auto
sales to pre-recession levels.
As the automobile sector is a key industry for growth, improving
auto sales will help the revival of the overall U.S. economy. Ford
expects the U.S. industry volume to range between 16–17 million
units in 2014, compared with 15.6 million units sold in 2013.
Meanwhile, GM expects industry sales in the range of 16–16.5
million in 2014.
FORD MOTOR CO (F): Free Stock Analysis Report
FIAT SPA (FIATY): Get Free Report
GENERAL MOTORS (GM): Free Stock Analysis Report
HONDA MOTOR (HMC): Free Stock Analysis Report
NISSAN ADR (NSANY): Get Free Report
TOYOTA MOTOR CP (TM): Free Stock Analysis Report
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