Carmageddon 2.0: Auto Sales Slump As Hurricane Bump Fades

I can’t help but wonder what the CNBC author was going to write. It’s not a sentence I ever thought I would put down, but in this case the omission might have meant something. In reporting on auto sales yesterday, the article started out with the ultimate cliffhanger:

Major automakers reported lower U.S. new vehicle sales for February on Thursday as consumer

As consumer what? Obviously, a mistake in the editing process, an-all-too-familiar occurrence in the modern media landscape where the very idea of an editor is becoming outlandish. Still, given where we are in this inflation and boom hysteria, please, CNBC, finish the thought!

A more cynical reader might expect the original text would have done so by saying the usual, something like “Major automakers reported lower U.S. new vehicle sales for February on Thursday as consumer spending continued to be strong, robust, and downright booming otherwise.” It would have been a hard case to make given these results, but since when has the media failed to live up to that challenge before? Alas, we will never know honesty or typicality.

The numbers weren’t good for the vast majority of the auto sector, as sales in the aftermath of the hurricane aftermath continued to wind down. The rundown for February 2018 (all rates are year-over-year): GM -6.9%; Ford an identical -6.9%; FCA -1%; Nissan -4%; Honda -5.6%. On the plus side was +4% for Toyota on the strength of its redesigned Camry; and +6% for VW.

There were a few more ominous developments alongside these disappointing results. First, the trend toward heavy incentive spending by automakers is starting to look like it may have run its course. Manufacturers throughout last year went deep into their own pockets to subsidize what turned out to be flat sales at best, and for most slightly declining volume.

Mark LaNeve, Ford VP of US Marketing, Sales, and Service, said:

In February, overall Incentive spend for the industry was down $65 year over year, and was down $50 sequentially to January. This is really a change from what we saw most of last year and in fact what we saw most of the last three years when year over year changes in incentive spend were up on average $300 to $400 consistently during that entire time frame.

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