US auto sales dropped by 4.2 percent for Sept. 2013, based in part on two fewer selling days than in Sept. 2012. Still, the month-over-month sales drop was the first the industry has seen in 27 months, perhaps demonstrating how fragile the economy is. Notably, the automakers released their figures on the same day that the federal government launched its Health Care Marketplace, a system full of glitches and problems that kept millions of Americans from signing up.
Obamacare and a Government Shutdown
And please remember that you have heard this here: Obamacare will present a huge drain on the economy and it will affect auto sales beginning in 2014. As Americans wake up to the reality of higher medical costs and fines for not participating in an unwieldy and untenable health care system, they will also see that their funds are being squeezed. Squeezed consumers delay their purchases especially for big ticket items such as cars.
Also weighing on most everyone’s mind is the federal government shutdown. Ford Sales Analyst, Erich Merkle, expressed confidence that a fix would be found stating, “We remain optimistic that our Government leaders will come together and they’ll ultimately support a solution that works for everyone.” That optimism could change if consumer confidence takes a hit.
GM Remains On Top, Just Barely
General Motors retained its position as top selling automaker in the US for the month, but barely. GM sold 187,195 units to Ford’s 184,452, with Toyota, Honda and Nissan falling as well. Chrysler sales were up a modest 0.7 percent, continuing a string of 42 consecutive months of increasing sales. Year-to-date sales still has GM on top followed by Ford, Toyota, Chrysler, Honda and Nissan. Subaru and Porsche posted double-digit gains for the month; BMW sales rose by 8.4 percent.
Ford and Chrysler both enjoyed robust sales of its large pickup trucks. For Ford, the automaker enjoyed its fifth consecutive month of F-150s sales topping 60,000 units for a 10 percent gain that positively impacted its monthly figures. On the Lincoln side of the house, the all-new MKZ sedan is seeing some traction with sales up by 12 percent.
Ram sales of 28,145 units represented an 8 percent increase over Sept. 2012, effectively carrying the Chrysler Group into the positive column. Strong Dart, Challenger and Charger sales paced Dodge, but Jeep sales fell 5 percent as dealers await the 2014 Jeep Cherokee held up because of production delays attributed to transmission problems.
GM’s drop may be attributed largely to a dip in its large pickup truck sales, blamed in part to the lack of availability for some models. The Chevrolet Silverado and GMC Sierra are all-new for 2014, while the Ford F-150 is a model year away from its next generation change. Ford slapped heavy incentives on the hoods of its trucks too, with discounts of $4,000 or more for 2013 models. GM just announced that it was placing a $4,500 cash incentive on its remaining 2013 Chevrolet Silverado inventory.
Toyota, Honda and Nissan Fall
Toyota sales fell by 4.2 percent, but the automaker noted that its day-over-day sales increased for the month. It also reiterated what others have said: that two fewer selling days detracted from what was otherwise a strong September. The Toyota Camry led in sales, with nearly 32,000 units sold followed by the all-new Corolla with sales topping 23,000 units. On the Lexus side of the house, the all-new 2014 Lexus ISrecorded a 42 percent sales increase.
Honda’s 9.9 percent sales drop cannot be attributed solely to two fewer selling days. Accord sales were up 13 percent to over 25,000 units sold and, surprisingly, sales of the Honda Ridgeline truck climbed for the seventh consecutive month. Sales of the Honda Odyssey and Crosstour fell a combined 40 percent and sales of select Acura models also dropped significantly.
Nissan sales slipped by 5.5 percent with its Maxima, Altima and Sentra models each losing market share. Demand for its Frontier pickup truck increased by 7 percent, while Versa sales increased by more than 9 percent on the strength of its new Note hatchback. Infiniti sales dropped by 4.3 percent with the all-new Q50 presenting a bright spot as more than 4,800 units have been sold since the vehicle became available in early August.
Like its competing manufacturers, Nissan was quick to look for a silver lining in its sales figures. “September was a unique month with fewer selling days than the prior year with the Labor Day weekend falling into August sales reporting for the first time in several years. While this skewed year-to-year comparisons we are optimistic that strong auto sales will continue into the fourth quarter,” stated Fred Diaz, divisional president, Sales and Marketing, Service and Parts, Nissan U.S.A.
Auto Sales: Best of the Rest
The rest of the auto industry results offered a mixed bag, but generally provided a blend of slightly falling and rapidly declining sales. Hyundai sales were down by 8.2 percent while its Korean cousin saw its sales plunge by 21 percent. Still, Hyundai managed to record its second best Sept. ever. Kia sales fell across the board as the automaker awaited the introduction of seven new or updated models over the coming months. It sold 926 units of its all-new and premium Cadenza sedan, perhaps the brightest light in its current line up.
BMW continues to put some distance between itself and Daimler although both companies recorded a sales increase for the month. Sales of Mitsubishi, Mazda, Volkswagen and Volvo fell while Jaguar Land Rover joined Subaru and Porsche in posting gains for Sept.
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