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Early look at February U.S. auto sales

  • Automobile sales made an impressive jump in the second week of February, according to data compiled by J.D. Power.
  • Winter storms had auto sales for the month tracking 5% lower than a year ago, but a strong bounce has now cut the falloff to closer to 1%. A monthly forecast for 15.7M vehicles delivered is back on track with more late-month momentum expected.
  • Perhaps of equal importance, pricing has held up with the average transaction price of $29.9K looking good for a challenging month to get potential buyers onto dealer lots.
  • What to watch: Analysts know February alone won't solve the inventory issue of the Big Three (GM, F, FIATY), but an improving trend needs to be confirmed to alleviate concerns. The month will also give a good read on several head-to-head model battles between Toyota (TM) and Honda (HMC).
Comments (3)
  • With January sales down 4% and February sales on track to be down another 1%, it will take a mighty push and some very good weather to get March sales up enough to catch up. The shortfall to date is roughly 50,000 vehicles, which are worth around $3B in lost profits - the bulk of which are with GM and Ford.

     

    GM January sales were down about 23k vehicles (roughly $1.5B in profits or 94 cents per share) and Ford sales were down about 10k units (roughly $600M in profits or 43 cents per share). And that was just January.
    23 Feb, 10:03 AM Reply Like
  • There are some math errors and typos in the above post: that $600M shortfall at Ford's should have read $60M, and that should be worth 1.5 cents per share. I have no idea how those other numbers came about, too late to fix them now.

     

    The 50,000 vehicles would be worth about $300M in lost profits, not $3B. Slipped a Decimal place apparently. GM's 23k vehicle shortfall would be just under half the total in profits lost (or deferred).

     

    Also I should clarify those are estimated gross production-level profits, before taxes, marketing, incentives, overhead, depreciation, etc.

     

    At the end of the day, Ford's North American unit profits in 2013 averaged about $2850 each before taxes, so the 10k unit shortfall in January are worth about a $29M in lost profits, or about 0.7 cents per share.
    24 Feb, 10:08 AM Reply Like
  • Great
    24 Feb, 09:27 AM Reply Like
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