Coverage: Auto sales post first quarter decline
Major auto makers on Tuesday posted declines in U.S. sales for the first quarter, adding pressure on car companies already grappling with weaker conditions in important markets globally.
Adrienne Roberts of The Wall Street Journal had the news:
The first-quarter decline makes it likely that full-year U.S. sales will fall below 17 million vehicles for the first time since 2014, analysts say.
General Motors Co., the largest U.S. auto maker by sales, said Tuesday sales through the first three months of the year dropped 7%. Fiat Chrysler Automobiles NV said sales dropped 3% in the first quarter.
Ford Motor Co. said it would report March sales on Thursday.
Joe Williams of Fox Business reported that tariffs and border issues could further hurt sales:
President Trump previously imposed double-digit tariffs on steel and aluminum imports, adding billions of dollars of costs across the auto industry.
The White House is also considering whether to impose double-digit duties on auto imports, a proposal the sector has warned would have widespread ramifications and lead to higher vehicle costs for consumers.
Trump has threatened to close the U.S.-Mexico border this week to stem the arrival of undocumented immigrants. Such a move could shut down the auto industry within a week, according to Kristin Dziczek, vice president at the Center for Automotive Research.
An update to the North American Free Trade Agreement is awaiting congressional review. Supporters are hoping for approval of the United States–Mexico–Canada Agreement (USMCA) by August.
Tom Krisher of the Associated Press reported that overall sales fell 2% in the quarter:
Automakers sold just over 4 million vehicles from January through March, according to Ward’s Automotive Intelligence, and industry analysts blame the decline on rising vehicle prices, competition from an abundant supply of late-model used vehicles and relatively high interest rates. Weak sales of cars, harsh winter weather and the partial government shutdown also had an impact.
“We can now confidently say new vehicle sales are past their peak,” said Jeremy Acevedo, Edmunds.com’s manager of industry analysis. “With new vehicle prices continuing to rise, interest rates sustaining post-recession highs and leasing growing increasingly expensive, pressure on the market is mounting.”
Most analysts are predicting vehicle sales of around 16.9 million this year, still strong but down from last year’s 17.27 million. Sales peaked in 2016 at 17.55 million.