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Beginning Of The End? Auto OEMs Miss March Sales 'Bigly' As Stocks Tumble

Despite continued heavy incentive spending, every auto OEM, with the exception of Nissan, missed their sales forecasts for the month of March.  The “D3” were the biggest losers of the month with GM sales up 1.6% YoY vs. estimates of +7.0% while Ford sales dropped -7.2% and Fiat Chrysler declined -5.0%.  Car sales were even worse with industry volumes down 10.6% overall versus light truck sales that were up 5.2% according to Autodata.

As Bloomberg points out, the massive sales misses come even though there “were a lot of incentives during the month” which will almost certainly result in further production cuts.

The results cast doubt on expectations that industrywide U.S. auto sales would bounce back following declines in the first two months of the year. Carmakers are using heavy discounts to try to trim inventory that’s swelled to the highest level in more than a decade. GM has dialed back output of cars such as the Chevrolet Cruze, while Fiat Chrysler is eliminating models including the Dodge Dart compact.


“Sales are under forecast, and there were a lot of incentives during the month,” Michelle Krebs, an analyst with Autotrader.com, said by phone. “Before long, we will see more production cuts.”


GM sees the the industry’s annualized sales pace, adjusted for seasonal trends, accelerating to 17 million for the month, trailing analysts’ estimates for a rate of 17.2 million. The selling pace was 16.7 million a year earlier.

Here’s how each of the large OEMs fared during the month:

Auto Sales


Meanwhile, overall auto sales so far in 2017 have been a disaster despite Ford’s assertion that they would remain elevated for the foreseeable future atop a so-called ‘plateau’.  As we noted once before, the crazy thing about plateaus is that there is a cliff on both sides…



Alas, no amount of incentive spending seems to be enough to fix that pesky inventory issue that keeps piling up on dealer lots across the country.

Auto Inventory


And auto investors finally seem willing to admit that perhaps ‘everything is not awesome’ as auto supplier and OEM’s all tanked in early trading.




So what say you?  Temporary blip on Ford’s plateau or bursting of the subprime auto bubble?

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