Cars and Drivers
Fiat Chrysler Sales to Drop 9% in September as Industry Stays Flat
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September car sales should tick up 0.7% to 1,440,000 compared to the same month last year, according to Kelley Blue Book (KBB). But Fiat Chrysler Automobiles Inc. (NYSE: FCAU) is expected to have another horrible month, with sales down 8.8% to 176,000. Sales for most other major car companies are expected to rise at a healthy pace.
Some of the increase in sales will be due to hurricane activity that destroyed hundreds of thousands of cars, mostly in Texas and Florida. According to Tim Fleming, an analyst for KBB:
September will be another opportunity for the first sales increase of the year, as we project slight growth for the industry. While major hurricanes devastated parts of Texas and Florida in the past month, this is driving replacement demand for those drivers with vehicles destroyed. This demand has already started in some areas, but will continue into October and potentially November, as vehicle insurance payouts are received.
No matter what the reason, the industry can use the lift. Car sales have started to slip from record levels and earnings at manufacturers have started to suffer.
General Motors Co. (NYSE: GM), the largest car manufacturer in the United States, is expected to have a banner month in September. KBB forecasts its sales will rise 7.7% to 269,000. Its market share is expected to reach a healthy 18.7%. In a rare set of circumstances, Toyota Motor Corp.’s (NYSE: TM) sales likely will pass Ford Motor Co.’s (NYSE: F). Toyota sales are forecast to rise 9.5% to 216,00, while Ford’s are expected to rise 2.7% to 209,000.
Among the second-tier companies, Honda Motor Co. Ltd.’s (NYSE: HMC) sales are seen rising 1.0% to 135,000. Nissan’s sales are expected to fall 9.2% to 116,000. Hyundai-Kia’s sales are expected to fall 10.2% to 104,000. Subaru’s surging sales will continue in September, up 5.6% to 53,000. Volkswagen will continue the rebound from its diesel engine scandal with sales up 7.1% to 49,500. The world’s largest car company continues to have tiny sales in the American market.
Fiat Chrysler has suffered as sales of many of its passenger cars have collapsed, part of a migration of American buyers to sport utility vehicles and crossovers. The trend has particularly hurt sales of many of its Chrysler and Dodge brand models. Jeep sales have not been able to rescue the company, as sales of some of its older models have eroded.
If Fiat Chrysler’s sales continue to fall, it could lose its number four spot in U.S. sales to Nissan, which would be unprecedented and catastrophic. Fiat Chrysler is fighting to remain a major manufacturer in America.
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