FCA's sales streak rides on minivans

When May sales for the U.S. are reported this week, analysts expect the industry to be down slightly -- mainly because of two fewer selling days than in May 2015, including one weekend day.

So if Fiat Chrysler ekes out its 74th consecutive year-over-year sales increase, as expected, it will likely do so with a big assist from a segment often dismissed as a has-been -- minivans.

It's not just the addition of the 2017 Chrysler Pacifica, which began production Feb. 29 and still is flowing into FCA US's roughly 2,400 Chrysler-Jeep-Dodge-Ram stores in the U.S. FCA's minivan resurgence also has a lot to do with the Dodge Grand Caravan, which will soldier on until next year, and the sell-down of the out-of-production Chrysler Town & Country.

The streak "gets more and more difficult because the target gets higher and higher," said Eric Lyman, chief analyst at TrueCar. "But there's a big opportunity here for growth from the sell-down of Town & Country and Grand Caravan."

FCA has hurdles to overcome to top the 202,227 vehicles it sold in the U.S. in May 2015, its second-highest monthly sales total that year, topped only by December. To beat the number, FCA has to make up sales likely to be lost by the two struggling sedans it plans to outsource to another automaker -- the Chrysler 200 and Dodge Dart.

In May 2015, FCA sold 20,007 units of the 200 and 8,667 Darts. But sales of the 200 were down more than 62 percent through April, and Dart sales were off 37 percent.

Yet, its two older minivans are in a good position to counteract the slacking sedans. 

Through April, Town & Country sales were up 64 percent over 2015 to 40,811, while Grand Caravan sales had more than doubled over the first four months of last year to 46,915. 

Those gains don't signal a sudden rush into minivans but are due to FCA shutting down its minivan plant in Windsor, Ontario, for 100 days in spring 2015 to retool to produce the Pacifica. During that period, the automaker severely limited minivan fleet sales in order to maintain retail inventories, depressing its reported monthly sales.

At the beginning of May, FCA and its dealers still had an inventory of 22,170 unsold Town & Countrys and another 29,247 unsold Grand Caravans. Both represent more than two months of supply. New monthly inventory figures will be reported Wednesday, June 1.

FCA offered aggressive incentives on its two older minivans in some regions in May, with bonus cash offers from $3,500 to up to $5,750.

The automaker also offered subvented leasing and financing offers, especially on the Town & Country. Current plans call for the Dodge Grand Caravan to continue production in its current form well into 2017.