The U.S. auto industry recorded its biggest monthly sales drop in nearly six years in May as most automakers posted declines amid plunging demand for passenger cars.
May volume fell 6.1 percent to 1.5 million vehicles. A 2.4 percent rise in truck sales, fueled by cheaper gasoline, failed to offset a 16 percent drop for cars. Among major automakers, only Fiat Chrysler, Subaru, Kia and Hyundai managed increases in a month that had two fewer selling days than May of 2015.
Still, the seasonally adjusted annual sales rate came in at 17.46 million, on par with last year’s U.S. record unit tally of 17.47 million vehicles.
"What needs to be low is still low -- unemployment, interest rates, gas prices,” Mark LaNeve, Ford Motor Co.’s U.S. sales chief, said today on a conference call to discuss the company's May results. “And what needs to be high is still high -- the housing market, and the average age of pickups. There are still lots of reasons to believe we’ve got a really strong industry to run at.”
Ford Motor volume fell 6.1 percent, as demand for each Ford and Lincoln passenger car was down.
May marked just the industry’s eighth monthly sales drop since 2009. The 6.1 percent decline was the biggest since August of 2010, when results were compared to the sales-boosting federal “cash for clunkers” incentives designed to drive the industry out of recession.
General Motors blamed tight inventories, the difference in selling days and a continued retreat from rental fleets for its 18 percent tumble. All of GM's brands posted double-digit declines in deliveries last month.
Fiat Chrysler Automobiles, boosted by strong Memorial Day weekend traffic and robust Jeep demand, eked out a 0.9 percent rise.
Toyota said sales dipped 9.6 percent to 219,339 vehicles -- including a 10 percent drop at the Lexus brand. Camry sales plunged 16 percent to 36,916, helping drag down Toyota Division car sales 19 percent overall.
American Honda said deliveries declined 4.8 percent to 147,108 vehicles with car sales down 2.2 percent and trucks off 7.6 percent. The Acura brand plunged 20 percent to 13,561 vehicles.
At Nissan, volume slipped 1 percent. VW brand deliveries plunged 17 percent, the brand's seventh consecutive decline in year over year monthly sales.
Subaru also managed a small increase of 1.1 percent and has now posted year-over-year gains in U.S. sales for 54 straight months. Kia posted a slight rise in volume last month, while Korean sibling Hyundai notched a 12 percent gain. Mitsubishi's deliveries slipped 5.7 percent.
FCA’s May results extended its streak of year-over-year monthly gains to 74, or just over six years.
Volume jumped 14 percent to a record 90,545 at Jeep. Sale rose slightly at the Ram brand, while deliveries slipped 19 percent at the Chrysler brand, 5 percent at Dodge and 19 percent at Fiat.
While analysts polled by Bloomberg expected May volume to drop at FCA, many of the company’s dealers reported robust sales over the holiday weekend.
“Notwithstanding a challenging calendar, we managed to muscle our way to our strongest May sales in over 10 years,” Reid Bigland, head of sales for FCA in North America, said in a statement.
Audi said it set a May U.S. sales record with volume rising 1.6 percent to 18,728 cars and light trucks.