The Detroit automakers have reported strong sales figures in December, the best ever since 2006. Falling gasoline prices and heavy sales of trucks and SUVs ensured that the year ended on a joyful note. The US automakers couldn’t have expected for better results as Detroit’s Big Three - General Motors (GM, Financial), Fords (F, Financial) and Chrysler - reported fantastic December sales which portrayed an improvement over December 2013.
2015 F-150, Picture from Ford
The story behind the numbers
A recovering economy, falling fuel prices, low interest rates and heavy sales of trucks and SUVs are the reasons behind the success of the Detroit automakers. U.S. car sales along with light trucks came to 16.52 million units, which is the first time it crossed the 16 million mark since 2006. Let’s take a look at the December sales of the top three U.S. automakers.
General Motors, the top US automaker, sold 274,483 vehicles registering 19% gain, beating analyst expectations comfortably. This was the best December sales in six years. In 2014, GM has sold highest number of vehicles in the country, retaining its crown of the largest American automaker. Its sales gain is attributable to the popularity of Chevrolet, SUVs and light trucks which further helped GM maximize its market share. It seems whatever GM touched turned to gold. Kurt McNeil, GM’s US vice president of sales operations, rightly said:
“Everything you need to have a great month was in place: Consumers felt good about the direction of the economy, interest rates and fuel prices were low, and our dealers did a great job introducing customers to our incredible range of new and redesigned vehicles.”
Ford, too, reported remarkable December sales. It managed to sell 220,671 units during the month and reported a 1% gain over the year-ago quarter. The carmaker’s annual sales came to 2,480,942 units. The sales gain is attributable to high volumes of sales of F-series pick-up trucks as well as Escape and Fusion. During the year 306,212 units of Escape were sold and 306,860 units pf Fusion were sold. These two models reported their best sales numbers, suggesting how rapid the growth has been for this automaker.
Chrysler sold 193,261 units and gained 20% in terms of units sold as compared to the previous year. However, it could not stand up to the expectations of the analysts who had predicted the figure to be 196,500 units. Nevertheless, Chrysler has also contributed to the overall growth and has gained the maximum market share as far as 2014 is concerned. The sales gain is attributable to the huge volumes of sales of Jeep, Ram truck and Chrysler vehicles. Chrysler has become the fastest growing automaker in the country.
Performance of the other automakers
Nissan (NSANY, Financial) reported good sales numbers in December, selling 117,318 units which rose from 109,758 units sold last year. The 6.9% improvement in sales was better than expected. Nissan registered an 11% gain to 1.39 million units for the whole year. The sales gain is attributable to the huge sales volumes of Sentra, Altima and Leaf.
RLX Sport Hybrid, Picture from Acura
Honda (HMC, Financial), on the other hand, posted a sales increase of 1.5% to 137,281 units in December, and failed to meet the expectations of analysts. The sales improvement was led by Honda’s luxury brand Acura whose sales grew 13% on the back of strong demand for ILX and TLX sedans. For the whole year, Honda division sold 1,373,029 vehicles, up 1% from 2013. Acura recorded the best ever year of sales since 2007 by selling 167,843 units.
Analysts expect growth momentum to slow down in 2015, but the current momentum of the Big Three does not make one think so. According to Kelley Blue Book, 2015 could see auto sales rise to 16.9 million vehicles. With the economy looking improving and oil price sliding, things look in favor of the automakers.
