December’s car sales are expected to be the best for any month of 2016, at 1.6 million. The manufacturer with the best results in terms of percentage increase is market leader General Motors Co. (NYSE: GM).
Although the 1.6 million number is impressive, it falls short of the same month last year by 2%. There are ongoing concerns that the U.S. car market has reached a top and that manufacturers will have to compete for market share within a smaller pie next year. The December number is expected to put sales for the whole of 2016 at 17.4 million. Kelley Blue Book (KBB), which provided the data, believes sales will moderate very slightly in 2017, in a range of 16.8 million to 17.3 million.
Tim Fleming, an analyst for KBB, wrote:
Substantial incentive hikes this year haven’t resulted in retail growth, while inventories continue to grow. An increasing supply of used cars, especially off-lease units, is already putting pressure on residual values, which could impact the sustainability of today’s high levels of leasing. We are looking for manufacturers to cut production in the new year to better match slowing consumer demand and alleviate the need for elevated incentives.
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KBB forecasts that strong December results will cause a market share increase for GM in 2016 from 17.8% to 18.8%. It is a massive drop from the 50% level of the early 1960s, but it allows the largest of the big three to claw back some of the sales it lost, many of which went to Fiat Chrysler Automobiles N.V. (NYSE: FCAU) in the past two years. GM December sales should reach 301,000, up 3.7%. The advance is owed to something of a one-car wonder, according to KBB:
General Motors’ growth is highlighted by a mid-size car, the Chevrolet Malibu. The new generation of Malibu has been well-received by critics, and is one of just two mid-size cars to increase sales volume this year.
For most car companies, sport utility vehicles and crossovers have been the engine of better sales numbers.
The largest drop in sales for December will come from once red-hot Fiat Chrysler. Its numbers are expected to drop a huge 11.2% to 190,000. That would trigger a market share fall off to 11.9% from 13.1% a year ago.
KBB’s forecast for GM, Fiat Chrysler, Ford Motor Co. (NYSE: F), Toyota Motor Corp. (NYSE: TM) and the balance of the industry, by manufacturer:
| Sales Volume 1 | Market Share 2 | |||||
| Manufacturer | Dec-16 | Dec-15 | YOY % | Dec-16 | Dec-15 | YOY % |
| General Motors (Buick, Cadillac, Chevrolet, GMC) | 301,000 | 290,230 | 3.7% | 18.8% | 17.8% | 1.1% |
| Ford Motor Company (Ford, Lincoln) | 232,000 | 237,606 | -2.4% | 14.5% | 14.5% | 0.0% |
| Toyota Motor Company (Lexus, Scion, Toyota) | 229,000 | 238,350 | -3.9% | 14.3% | 14.6% | -0.3% |
| Fiat Chrysler (Chrysler, Dodge, FIAT, Jeep, RAM) | 190,000 | 213,924 | -11.2% | 11.9% | 13.1% | -1.2% |
| American Honda (Acura, Honda) | 146,000 | 150,893 | -3.2% | 9.1% | 9.2% | -0.1% |
| Nissan North America (Infiniti, Nissan) | 135,000 | 139,300 | -3.1% | 8.4% | 8.5% | -0.1% |
| Hyundai-Kia | 121,000 | 117,749 | 2.8% | 7.6% | 7.2% | 0.4% |
| Subaru of America | 58,000 | 56,274 | 3.1% | 3.6% | 3.4% | 0.2% |
| Volkswagen Group (Audi, Volkswagen, Porsche) | 57,500 | 55,291 | 4.0% | 3.6% | 3.4% | 0.2% |
| Total 3 | 1,600,000 | 1,634,329 | -2.1% | – | – | – |
| 1 Historical data from OEM sales announcements | ||||||
| 2 Kelley Blue Book Automotive Insights | ||||||
| 3 Includes brands not shown | ||||||
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