DETROIT (Reuters) - Major automakers on Wednesday reported lower U.S. new vehicle sales for July amid steep declines in passenger cars, except Fiat Chrysler Automobiles NV (FCA) (FCHA.MI) (FCAU.N), which said its sales climbed 6 percent.
FILE PHOTO - Cars are seen in a parking lot in Palm Springs, California, U.S. on April 13, 2015. REUTERS/Lucy Nicholson/File Photo
U.S. consumers have been shifting rapidly away from traditional passenger cars in favor of larger, more comfortable SUVs and pickup trucks, which are also more profitable for automakers.
“Every year there is a clunker of a month,” Mike Jackson, chief executive of AutoNation Inc (AN.N), the largest U.S. auto retail chain, told Reuters. “I think July will be that month from a retail point of view.”
U.S. new vehicle sales rose in the first half of 2018, boosted in part by an overhaul of the tax system, but are expected to fall in the second half amid rising interest rates and a glut of cheaper, nearly new used vehicles.
FCA’s rise in July sales was due mostly to higher sales to consumers, above all a 15 percent jump in sales of its popular high-margin Jeep brand.
Sales at Ford Motor Co (F.N) slipped 3.1 percent for July. Ford’s retail sales sank 10.4 percent, largely due to a 28 percent slump in passenger cars.
But sales of Ford’s high-margin pickup trucks jumped 10.2 percent.
The No. 2 U.S. automaker said earlier this year it would gradually cease production of most passenger cars in the United States. On a conference call with analysts and reporters, Ford’s U.S. sales chief Mark LaNeve said the automaker had ended production of its Focus sedan and was winding down output of the Fiesta.
Earlier this year, General Motors Co (GM.N) stopped reporting monthly sales and switched to releasing them on a quarterly basis. The No. 1 U.S. automaker’s sales were also expected to be down slightly for July.
At Nissan Motor Co Ltd (7201.T), vehicle sales fell 15.2 percent in July, with passenger car sales down 21.1 percent and SUV and pickup truck sales down 10.6 percent.
Honda Motor Co Ltd (7267.T)’s July sales were down 8.2 percent. Its passenger car sales were off 19.3 percent, while sales of its SUVs rose 3.2 percent.
Ford shares dipped 0.8 percent in morning trading, while FCA’s shares fell 1.4 percent.
Last week, Detroit’s automakers warned that mounting U.S. and Chinese tariffs would hurt their results in 2018.
Reporting By Nick Carey; Editing by Bernadette Baum
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