U.S. light-vehicle sales rose 1% year over year to 1.42 million in Jun 2014. The weak increase is mainly due to two less selling days in Jun 2014 compared with Jun 2013. In the first half of 2014, U.S. light-vehicle sales improved 4% year over year to 8.17 million units.
Sales on a seasonally adjusted annualized rate (SAAR) basis increased to 17 million in Jun 2014 from the year-ago level of 15.9 million units. This is the first month since Jul 2006 in which SAAR reached 17 million.
The major automakers reported mixed results. While General Motors Company (GM - Analyst Report) , Toyota Motor Corp. (TM - Analyst Report) , Nissan Motor Co. Ltd. (NSANY - Snapshot Report) and Chrysler posted sales growth, sales at Ford Motor Co. (F - Analyst Report) declined.
Now, let us look at the U.S. sales figures reported by the individual automakers.
General Motors recorded 267,461 vehicle sales in June, up 1% year over year. Retail sales also increased 1%, while fleet sales improved 2%. After eliminating the effect of 2 less selling days, total sales, retail sales and fleet sales recorded an improvement of 9%, 9% and 10%, respectively.
Ford reported a 6% decline in total sales from the year-ago period to 222,064 vehicles in Jun 2014. Retail sales fell 5% year over year to 145,989 units and fleet sales plunged 7% to 76,075 vehicles.
Chrysler Group – controlled by Italy’s Fiat S.p.A – recorded a 9% year-over-year rise in sales, pulling the figure up to 171,086 vehicles. Chrysler witnessed a year-over-year increase in monthly sales for 51 consecutive months, which is impressive. Moreover, this is the best June sales for the group since 2007.
Toyota’s sales increased 11.9% year over year on daily selling rate (DSR) basis and 3.3% on volume basis to 201,714 units in Jun 2014. Sales in the Toyota division improved 2.5% based on volume and 11% on DSR basis to 178,196 units. Lexus sales rose 19.3% on DSR basis and 10.1% on volume basis to 23,518 units.
Honda Motor Co., Ltd. (HMC - Analyst Report) recorded a 5.8% year-over-year decrease in sales on volume basis to 129,023 vehicles in Jun 2014. Sales on DSR basis increased 2.1%. Sales in the Honda Division decreased 4.3% on volume basis but rose 3.6% on DSR basis to 117,817 units. Sales of the Acura Division fell 18.6% on volume basis and 11.8% on DSR basis to 11,206 vehicles.
Nissan Motor posted a 5.3% year-over-year increase in sales to 109,643 vehicles in June. Sales in the Nissan division also climbed 6.4% to 101,069 units. However, sales of the Infiniti Division fell 5.9% to 8,574 units in the month.
The strong U.S. auto sales in the first half of 2014 is expected to continue in the second half as well. High incentives by automakers, low interest rates, the rising employment rate, increasing consumer confidence and recovery of the housing market are some of the factors driving sales.
Moreover, with the improvement in the general economic situation, banks are offering more car loans with lower interest rates and longer repayment periods. Further, the high average age of cars on the U.S. roads is resulting in high replacement demand for cars as well as car parts.
In the long run, sales are expected to rise on the back of pent-up demand, improving macroeconomic conditions and easier car financing. As the automobile industry is a major contributor to the U.S. economic growth, improving auto sales will help in reviving the overall U.S. economy.