U.S. light-vehicle sales dropped 0.7% year over year to 1.51 million units in Aug 2015. Sales on a seasonally adjusted annualized rate (“SAAR”) basis surged to 17.81 million units in Aug 2015 from 17.3 million units in Aug 2014.

The sales volume was driven by low gas price, an improving employment rate as well as the easy availability of credit with lower interest rates and longer repayment periods. However, the inclusion of the Labor Day weekend in September this year, compared to August last year, resulted in a year-over-year decline in August sales figures.

Among the six major American and Japanese automakers, Ford Motor Co. F recorded the maximum year-over-year improvement in Aug 2015. Meanwhile, General Motors Company GM led in absolute figures for the month.

Now, let us look at the U.S. sales figures reported by individual automakers.

U.S. Automakers

General Motors recorded 270,480 vehicle sales in August, marking a 0.7% year-over-year decline. However, retail sales improved 5.9% to 224,978 units. Meanwhile, fleet sales were down 24%.

Ford reported a 5% increase in U.S. sales from the year-ago period to 234,237 vehicles in Aug 2015. This is the company’s best August sales in nine years. Sales volume of the Lincoln brand vehicles improved 6% year over year to 8,636 units in the month. Sales of the Ford brand grew 5.4% year over year to 225,601 vehicles.

FCA US LLC (formerly Chrysler Group) – controlled by Fiat Chrysler Automobiles FCAU – recorded a 2% year-over-year rise in sales to 201,672 vehicles in Aug 2015. With this, the company’s monthly sales have increased year over year for 65 consecutive months. This impressive feat also marks the best August sales for the group since 2002.

Japanese Automakers

Toyota Motor Corporation’s TM sales went down 8.8% year over year to 224,381 units in Aug 2015. Adjusting for one less selling day in Aug 2015 compared with Aug 2014, sales declined 5.3% on a daily selling rate (“DSR”) basis. Sales in the Toyota division fell 10.5% on volume basis and 7.1% on DSR basis, to 190,894 units. Lexus’ sales rose 2.1% on volume basis and 6% on DSR basis, to 33,487 units.

Honda Motor Co., Ltd. HMC recorded a 6.9% year-over-year decline in sales on volume basis to 155,491 vehicles in the month. On DSR basis, results were down 3.3% from the year-ago period. Sales of cars amounted to 82,483 units in August, while sales of trucks were 73,008 units.

Nissan Motor Co. Ltd. NSANY reported a 0.8% year-over-year decrease in sales to 133,351 vehicles in August. Sales in the Nissan division also slipped 2% to 122,716 units. However, sales of the Infiniti Division surged 16.1% to 10,635 units. 

Outlook

Automakers are gaining from low fuel prices and interest rates, rising wages and household wealth, and improving job security. Further, ongoing recovery in the U.S. economy is leading to an improvement in consumer confidence.

Automakers are also aiming to increase market share by offering large incentives and discounts to customers. Additionally, banks are providing more car loans with lower interest rates and longer repayment periods.

Further, the high average age of cars on the U.S. roads is resulting in high replacement demand for cars as well as car parts. All these factors are working in favor of auto sales in the U.S. As the automobile industry is a major contributor to U.S. economic growth, improving auto sales should help in the recovery of the overall U.S. economy.

The outlook for long-term auto sales remains positive, based on improving macroeconomic factors, residual pent-up demand, attractive deals and vehicle launches. U.S. light-vehicle sales look set to drive past the 17 million mark in 2015.

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FORD MOTOR CO (F): Free Stock Analysis Report
 
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GENERAL MOTORS (GM): Free Stock Analysis Report
 
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