Sandy's saga: When car shoppers shopped for flashlights
Consider it a solid month, interrupted. October U.S. light-vehicle sales rose 7 percent even though Hurricane Sandy killed end-of-the-month business along most of the Eastern Seaboard.
Sandy smashed into the New Jersey shore late Monday, flooding coastal areas and knocking out power to millions of homes and businesses along the Atlantic coast from Georgia to Maine and inland as far Michigan.
Even with many dealers closed and consumers huddled in their homes the last three business days of October, the month's 1.1 million auto sales produced a seasonally adjusted annual selling rate of 14.3 million.
That's down from September's 14.9 million and well below prestorm forecasts of a SAAR of 14.8 million or more. But it was still the fifth-best selling monthly rate of 2012 and well above the 13.3 million SAAR of October 2011.
Assessing the storm's effect was hard to measure. Ford Motor Co. sales boss Ken Czubay estimated that Sandy reduced October U.S. industry volume by 20,000 to 25,000 units, cutting about 300,000 off the SAAR.
TrueCar.com Vice President Jesse Toprak had a higher number: 32,000 actual units, or enough to reduce the SAAR by 400,000.
"October was another great sales month, even if was slowed at the end by Hurricane Sandy," he said.
Auto sales were trending high early in the month -- "almost a 15-million SAAR pace until people in the Northeast realized how bad Sandy was going to be," Toprak said. "On Saturday [Oct. 27], people stopped shopping for cars and starting shopping for bottled water and flashlights."
Among the highlights:
- Big winners: Volkswagen, Toyota and Chrysler were the biggest companies to post double-digit increases in October, led by a 22 percent surge at Volkswagen Group of America. Toyota Motor Sales rose 16 percent, and Chrysler Group was up 10 percent.
- Big companies, smaller gains: American Honda gained 9 percent; General Motors, 5 percent; Hyundai-Kia America, 3 percent; and Ford, up a mere 445 units.
- Nissan's pain: The only major automaker to lose October volume was Nissan North America, down 3 percent. Nissan Division General Manager Al Castignetti said Nissan was hit hard by Sandy in the Northeast, "our strongest-performing region with more than 225 area dealers."
- Smaller players' gains: Among select smaller players, five automakers posted October increases, led by Subaru's 30 percent gain. BMW Group gained 19 percent, and rival Daimler was up 9 percent. Suzuki rose 5 percent, and Mazda was up 2 percent.
- Smaller players' declines: Three others lost sales volume for the month: Jaguar Land Rover fell 20 percent, Volvo was down 14 percent, and Mitsubishi dropped 9 percent.
- Quick comeback? Hurricane Sandy may have slashed October volume, but the loss will be regained quickly, and some think it eventually will boost overall new-vehicles sales because vehicles destroyed by the storm will have to be replaced.
"We still have a lot of our dealerships without power and we're doing our best to support them," said General Motors U.S. sales boss Kurt McNeil. "But as you look at past national disasters, it does tend to snap back relatively quickly."
TrueCar's Toprak said replacing vehicles eventually would boost net new-car volume, but demand won't start to bounce back until mid-November.
"The infrastructure must get back on line and insurance companies start reissuing new policies in the storm area," he said. "If that happens by mid-month, then sales will get a little Sandy bump this year. If it's delayed, that might be pushed into January."
Toyota sees a minor sales delay.
"We probably lost about 4,500 [October] sales due to the hurricane," said Bill Fay, Toyota Division general manager. "It will take a few months to make up for Sandy."
Ford expects a rebound, too.
"What we have learned historically from these tragic events is that obviously sales are postponed and [then] come back relatively quickly," said Czubay. "After insurance comes in, people use those proceeds to buy new vehicles."
- Luxury race tightens: The race for best-selling U.S. luxury brand got even closer in October. BMW brand, No. 1 last year, outsold Mercedes-Benz (excluding Sprinter vans), 26,451 to 23,978 for the month. That cut the Mercedes 2012 lead to date in half to just 2,755 units, 215,603 to 212,848.Theresa Clift contributed to this report
You can reach Jesse Snyder at firstname.lastname@example.org.