New vehicle sales in US fell 1.3% in 2019 but still healthy
DETROIT (AP) — New vehicle sales in the U.S. fell 1.3% last year, but the numbers still passed the healthy 17 million mark for the fifth straight year.
Automakers sold 17.05 million new cars, trucks and SUVs in 2019. Although buyers spent more on vehicles, companies had to prop up sales with record discounts, according to analysts.
Following a long trend, 69% of new vehicles sold last year were trucks or SUVs, with truck sales up 2.6% from a year ago. Car sales fell once again, by 10.1%, according to Autodata Corp.
Sales at General Motors fell 2.5% for the year as a 40-day strike by the United Auto Workers union cut into inventories in the fourth quarter. Ford sales fell 3.2%, while Fiat Chrysler sales dropped 1.4%. Sales at Toyota fell 1.8% and Nissan sales tumbled almost 10%.
The Edmunds.com auto pricing site predicted that more than half the new vehicles sold last year were SUVs, passing 50% market share for the first time.
Also for the first time, Fiat Chrysler’s Ram pickup beat the Chevrolet Silverado in full-year sales as GM retooled factories to built a new version of the Silverado.
Electric vehicle sales rose almost 37% last year to just over 236,000, Autodata reported.
Tesla reported global sales on Friday without singling out the U.S. The Palo Alto, California, electric vehicle company said sales rose over 50% to 367,500.
Last year turned out to be strong as uncertainty waned in talks over a trade agreement with Canada and Mexico and progress toward a trade deal with China, said Jeff Schuster, president of global vehicle forecasts for LMC Automotive, a consulting firm.
Schuster predicted stability this year but wrote that sales could be a bit lower than in 2019.
Last year’s sales numbers defied the odds, especially because high interest rates and record prices squeezed some buyers, said Jeremy Acevedo, senior manager of industry insights for Edmunds. “If 2019 taught us anything, it’s that you can’t underestimate the power of a strong economy,” he said. Edmunds provides content for The Associated Press.
The average new-vehicle sale price in December hit an estimated $34,602, setting a record, according to J.D. Power and LMC. Truck and SUV prices hit an estimated $36,935, rising $655 from 2018. Car prices averaged $27,461, a small increase from a year earlier.
But the average incentive, or discount, per vehicle was expected to reach $4,600, a record figure that’s up almost 7% from 2018, according to LMC and J.D. Power.
Thomas King, president of analytics at J.D. Power, said the record sale prices shows that automakers are building the types of vehicles that people want to buy. But the record incentive level “signifies that there is still too much supply relative to overall demand.”
Other major automakers reporting sales Friday included Honda, which rose 0.2%, and Hyundai, which was up 4.7%. Subaru sales rose 2.9%, with the maker of all-wheel-drive vehicles reporting record sales for the 11th straight year. Volkswagen Group sales also rose in 2019, by 1.8%.