Ford Motor Company Was Left in the Dust Last Month
So far, it appears that the automotive industry will post overall weaker results than the expected 8% rise in February new-car sales, compared to last year.
Toyota looks to be the big winner with 13% gains, and thus far the only automaker to post results above industry wide expectations. One reason behind weaker than expected results: Harsher winter weather affected large parts of the nation during the second half of February, and it's likely those sales will be pushed into March Yong Yang, Fords chief economist for the Americas, had this to say on a conference call:
With that in mind, let's take a look at sales highlights from Ford Motor Company , General Motors , and Fiat Chrysler Automobiles .
How bad was it? Ford certainly posted the most disappointing February sales results thus far, and while there was reason to be disappointed, there is reason to believe it isn't quite as bad as it appears. Consider that Ford has been winding down its fleet sales, and more specifically its daily rental fleet sales which are less desirable than fleet sales to commercial or government consumers.
During February, Ford's fleet sales as a percentage of overall sales dipped to 30%, compared to last year's February mark of 32%. Furthermore, that decrease was fueled by a decline in daily rental sales, which accounted for 13% of sales during last year's February, but only 11% of overall sales last month.
A decline in fleet sales is part of the reason behind Ford's overall sales decline, but it isn't responsible for all of it. Ford's car and utility segments declined by 8% and 2.3%, respectively. Also, Ford's Lincoln luxury brand declined 7.5% compared to last year, which is actually worse than it appears as the new MKC, with sales of 1,558 units wasn't available during last year's comparable February.
There were some bright spots, though. Ford's Mustang posted a 32% sales increase and saw sales in its two largest markets, California and Texas, surge more than 130% and 40%, respectively. Also, Ford's large SUV, the Explorer, also posted a 32% sales gain to more than 17,000 units -- which makes it Ford's fourth best-selling vehicle last month. That's a good sign as SUV's are more profitable than passenger cars, and as gas continues to lower it should provide a sales boost on more profitable vehicles in 2015.
Though Ford was left behind in sales gains last month, January and February are historically weaker months and as the company's best-selling vehicle, the F-150, ramps up production -- its Kansas City, Missouri plant comes online this month -- investors should expect sales to improve throughout the second quarter. If overall sales don't start to improve by mid-year, it will be cause for concern.
Chevy's Colorado is now the industry's fastest-selling pickup. Image source: General Motors
General Motors Total sales at America's largest automaker rose 4% last month, compared to a year ago. While that checked in under analyst estimates of roughly 6% for the company, GM had some very notable increases.
Consider that pickup sales were up 37% and large SUVs were up 66%. That's great news hoping GM can ride rising sales of trucks -- typically the most profitable segment in the U.S. auto industry -- and large SUVs to a much more profitable than expected 2015.
Also, riding the wave of new SUV and pickup sales, GM's average transaction prices checked in at $34,700 according to PIN estimates through Feb. 22, which is a healthy $2,700 increase per unit, compared to the same time frame last year. Furthermore, PIN also estimates that incentives as a percentage of ATP was actually down 90 basis points in February, month over month.
Last but not least Checking in with the best sales performance of these three automakers, in terms of gains not overall volume, was Fiat Chrysler Automobiles with a 6% rise in February new car sales, compared to last year. That extends FCA's consecutive year-over-year sales gain to an impressive 59th straight month.
It should be no surprise to those following the automotive industry that the gains were largely driven by FCA's surging Jeep brand. Jeep brand sales were up 21% last month, compared to the prior year, and the brand has set a sales record in each month dating all the way back to November of 2013 -- which is pretty ridiculous.
Despite tougher year-over-year comparisons, here's a look at how strong Jeep's gains have been.
Looking at another very important brand for FCA, its Ram Truck brand which includes the Ram ProMaster, ProMaster City, and Ram Cargo Van, were up 12%. Sales of the Ram pickup were up 7% in January and it was the truck's best February since 2004.
Overall, nine FCA vehicles recorded their best February sales ever, which suggests that despite tough year-over-year comparisons, demand is still strong for FCA's vehicle lineup, and 2015 should be another solid year of sales gains.
The article Ford Motor Company Was Left in the Dust Last Month originally appeared on Fool.com.
Daniel Miller owns shares of Ford and General Motors. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright 1995 - 2015 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.