The 2014 Jeep Grand Cherokee SRT high performance vehicle at the 2013 North American International Auto Show in Detroit, Strong sales of the vehicle helped Chrysler post a 16-percent jump in sales in November.
Sales of new cars surged at an unexpectedly strong rate for November, exceeding initial forecasts that might have suggested the domestic market was beginning to slow down after a torrid spring and summer.
The November increase was matched by a solid increase in transaction prices as consumers stepped up to purchase the latest models as well as more expensive trucks and utility vehicles.
The Big Three Detroit automakers may have been among the winners over a Thanksgiving holiday weekend that has traditionally seen shoppers focus on department store and electronic bargains, rather than cars. Aided by their own Black Friday sales promotions, automakers kept showrooms busy – helping boost the seasonally adjusted annual sales rate, or SAAR, to 16.3 million, the best monthly figure this year, and a sign the industry has managed to shrug off a drop in consumer confidence that followed the government shutdown in October.
Chrysler Group posted a 16 percent sales increase for November, while General Motors was up 14 percent. Ford had the smallest gain of the Detroit makers, but still managed to deliver a 7 percent increase. It was the strongest November for the domestic makers since the years before the 2008 crash of Lehman Brothers and the onset of the Great Recession.
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Going into the final week of November, preliminary estimates called for a more modest industry increase of perhaps 4 percent overall, according to forecasts from the likes of J.D. Power and Associates. John Mendel, the top American executive at Honda, had warned that while the industry would be up overall, some makers might be deep in the negative category.
But aided by the Black Friday push, almost every maker was able to stay in the black. Toyota, Nissan, Jaguar-Land Rover and Audi also posted double digit sales increases, while global industry sales leader Toyota posted a 5.9 percent jump for the month.
“We feel good about the direction of the economy and our own momentum,” said Kurt McNeil, GM's vice president for U.S. sales operations. “The economy is creating jobs and household wealth. Energy costs are dropping and credit is available and affordable. All of this bodes well for future growth.”
McNeill noted that November demand was strong “for everything from cars to crossovers,” and said he expects to see momentum carry over into 2014 with a wave of well-reviewed new models.
Ford, the second-largest domestic maker, reported setting records with its subcompact Fiesta and midsize Fusion sedans even as it struggled to meet demand for its full-size F-Series pickups.
“We continued to see sales increases across our full family of vehicles – particularly with our passenger cars and utilities in conquest coastal markets – helping us post our best November retail sales performance since 2004,” said John Felice, vice president for U.S. marketing, sales and service.
Chrysler extended its streak of year-over-year sales gains to 44-consecutive months, noted Reid Bigland, head of U.S. Sales for the Chrysler Group. But the maker was particularly pleased to receive a strong pull from consumers for the much delayed Jeep Cherokee which, said Bigland, “is off to a terrific start.”
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Toyota reported sales increased 10.1 percent from November 2012, with momentum growing in the final days of the month.
"Industry sales in November picked up after Thanksgiving contributing to the best sales pace of the year," said Bill Fay, Toyota division group vice president and general manager. "Showroom traffic surged over the holiday weekend for Toyota, indicating good momentum we expect to continue through the end of the year and into 2014," he said.
Nissan said its flagship Nissan Division saw sales climb 10.8 percent, while its luxury brand Infiniti reported a sales jump of 10.5 percent, spurred by strong deliveries of the new Q50 sports sedan and QX60 7-passenger luxury crossover.
Korean carmaker Hyundai , which has struggled with inventory shortages for much of the year, reported a relatively modest 4.6 percent sales increase for November.
Audi was among a number of makers to set records for the month, the luxury arm of Volkswagen AG jumping 13 percent compared to the previous record set last November. It was, in fact, the 35th consecutive month of record sales for Audi, “The story of…strength across our product lineup,” proclaimed Mark Del Rosso, Executive Vice President and Chief Operating Officer, Audi of America.
The German brand’s sibling, Volkswagen, was one of the rare brands in the red, sales sliding 16.3 percent for the month. The results during November also virtually guarantees that VW will finish with a full-year decline.
For Jaguar-Land Rover, it was the best November since 2005 as sales jumped 37 percent.
Industry analysts were pleased not only by the overall upturn in November sales but by the $946, or 3 percent, jump in Average Transaction Prices – what customers actually paid after factoring in discounts and incentives – compared to October. At an average $32,769, the figure was also up $352, or 1.1 percent, compared to a year ago, according to Kelley Blue Book, a provider of new and used car data.
“Transaction prices continue to rise as consumers look for newly introduced or redesigned models as well as crossovers and pickup trucks,” said Alec Gutierrez, senior analyst for Kelley Blue Book.
Despite the rise in transaction prices, automakers are keeping an eye on inventories, which are expected to fall as carmakers shut plants later this month for Christmas.
First published December 3 2013, 9:29 AM