Automotive sales dip in JanuaryDate posted: 3/16/14 07:00:00 AM
The nation's real estate market wasn't the only sector slowed by dreadful weather in January. According to The Wall Street Journal, the frigid cold and seemingly never-ending snowfall made it tough sledding for the nation's auto industry.
"There were a few days where no one outside of employees walked through the front doors," George Waikem, manager of Nissan, Kia and Ford dealerships in Northeast Ohio, told the Journal. "We did see a slight spike in our Web traffic, but it didn't seem to generate into physical visits. Anyone brave enough to visit us pretty much drove away in a new or new-to-them vehicle. They obviously weren't out just kicking tires but fulfilling a real need."
The top three vehicle sellers in the U.S. - General Motors, Ford and Toyota - all recorded a drop in sales year-over-year in January.
General Motors, which is the nation's largest carmaker, said sales dropped 12 percent in January to 171,486 vehicles. Ford reported a seven percent dip in sales, with 154,644 units bought, according to The New York Times.
Honda and Volkswagen also posted declining sales totals, according to the Journal.
Staying positive despite a slow January
The U.S. market is still strong and sales figures should swell when the weather improves, leaving several auto executives optimistic for the future.
Chrysler actually did quite well. The Detroit-based automaker posted an eight percent sales increase to 127,183 vehicles for its best January sales performance in six years, according to the Times. January marked the 46th straight month of sales gains for the automaker.
"It's difficult given the weather to actually tease much out of the month," Joseph Spak, an automotive analyst with RBC Capital Markets, told the Times. "If sales are delayed because of weather, you do see that come back over the following months, so I wouldn't read too much into it."
Predicting sales totals in 2014
Sales figures are expected to surpass 16 million units in 2014, which would be the best showing since before the recession. Sales hit 16.2 million units in 2007, according to the Times. Last year in the U.S., sales increased 7.6 percent to 15.6 million vehicles.
"We have major launches underway, and we are going to accelerate brand-building and other growth initiatives, which include executing our winning strategy to sell more pickup trucks with larger cabs, more features and advanced technology," Kurt McNeil, General Motors' vice president for sales operations in the U.S., said in a statement.
Homeowners that can't afford to put a down payment on a pickup truck with advanced technology should consider a home equity line of credit. This type of credit asks a borrower to put their home down as collateral. In turn, the homeowner receives a line of credit that can be used for an automobile, home renovation or student loan repayment.
"The overall performance [last month] correlated pretty closely with the weather," John Felice, Ford's vice president of sales, told the Journal. "We expect things to return back to trend. All the fundamentals still look really solid."
Problems at GM
According to the Times, three brands under the GM branch - Cadillac, Chevrolet and GMC - struggled with sales in January, each dropping 10 percent or more.
Buick, also owned by GM, managed just a 1.4 percent decline. The Times reported the best selling cars manufactured under the GM umbrella were the Chevrolet Cruze and Cadillac SRX crossover. Sales for the Cruze model rose 16 percent, while the SRX notched a 1.5 percent increase in sales. GM said it was the best January ever for both models.
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