5 things we learned from October auto sales – USA TODAY
Heros, villains and “you got to be kidding.” USA TODAY’S James R. Healey breaks down the unexpected results of October auto sales.
(USA MONEY, USA TODAY)
October was another strong month for auto sales and the big engines of that growth — $3 gas, long and cheap loans and an improving economy — promise to continue driving sales into this month.
Some quick highlights:
• Vehicle sales boomed at an annualized rate of 16.46 million vs. 15.38 million a year ago, according to Autodata.
• The estimated average transaction price (what people actually paid) for new cars and trucks was $32,957 in October 2014, up $778 (2.4%) from October 2013 and up $870 (2.7%) from September 2014, according to TrueCar.
• The average new-car loan in October was 67 months, second longest on record, according to Edmunds.com.
• Sales incentives averaged $2,629 per vehicle, and the ratio to average transaction price was 7.9%, down from 9.3% in September, according to TrueCar.
“Transaction price gains in October continued to outstrip incentive spending, and that’s great news for profit margins,” said John Krafcik, president of TrueCar in a statement.
In the latest USA TODAY monthly Auto Sales Breakdown of the numbers, here are five things we learned:
1. Conventional wisdom let us down.
The auto industry’s full of maxims and truisms, widely believed, deeply held.
One is, “New sheetmetal sells cars.” Not necessarily, the October new-car sales data show. Hyundai knocked itself out remaking the popular Sonata midsize sedan and got a kick in the teeth, sales-wise, for its trouble.
Another is “cheap gas kills cheap cars,” meaning low gas prices ruin demand for low-price small cars. Not so in all cases. Mitsubishi — remember Mitsubishi? — tripled sales of its low-price, three-cylinder Mirage small car. Not only did such an explosive burst come at a time of falling gasoline prices, it was accomplished by a company that’s shrunk to near invisibility here.
FULL STORY: You can’t believe everything you hear
2. Some things REALLY surprised us in October.
Camouflaged by October’s healthy overall new-vehicle sales were some unexpected breakouts and breakdowns that prompted some head scratching by the USA TODAY Auto Team.
There was Mitsubishi’s odd couple — the Outlander Sport SUV and the tiny Mirage 3-banger econobox — that together drove the brand to one of the biggest percentage sales gains of any automaker in the month. And there was Hyundai’s fully redesigned and glowingly reviewed 2015 Sonata sedan, which had trouble matching 80% of the sales the old model racked up last October.
On the other hand, a mild refresh of Volkswagen’s Jetta for 2015 sent sales jumping and along with the new Golf’s results broke VW’s losing streak of monthly sales declines. Another mild refresh that scored was Ford’s for the big Expedition and Navigator truckie SUVs. Even the loss of their V-8 engines couldn’t slow them down.
And Ford’s 2014 F-150, being radically replaced for 2015, barely missed a beat — even though the main factory building them was shut down and retooled to start building the new version.
FULL STORY: Heroes, villains and, ‘What?’
3. Check October’s slowest sellers, not the fastest, for November deals.
The 2015 Mustang shares October’s fastest-selling title with a sedate vehicle that got a very mild redesign: the 2015 Honda CR-V, according to Cars.com. It took just seven days to sell both the sports coupe and the sports utility.
Other small SUVs also sold quickly, with the 2015 Nissan Rogue taking 15 days to sell and the 2015 Toyota RAV4 taking 16. But those two still weren’t fast enough to make the top list.
Cars.com also found some interesting cars lingering on lots that we’d suggest shoppers check out, too. Tops among the Cars.com November Deal Picks is Infiniti’s Q50 sedan. It’s been dinged for its numb steering and dumb multimedia system but still offers a lot of performance and luxury for a decent price.
And its price may be easier to negotiate because of the slow sales.
4. Top 20: Showing the love for trucks, SUVs.
Americans’ love affair with trucks and SUVs was encouraged in October by $3 gas in many areas and cheap long-term financing. An uptick in housing starts in September may also have boosted the pickups. Twelve of the top 20 best-selling new vehicles in October, according to Autodata, were SUVs or pickups, generally thirstier and more expensive than comparable cars.
Full-size pickup sales, alone, took the top three spots and gained 9.1% in sales overall. Conversely, the Toyota Prius — ever the reliable indicator of popularity for fuel-sippers — fell 13.5%, and it failed again to make the top 20, even as Toyota threw more cash on the hood vs. year-ago levels.
FULL STORY: Americans pile into trucks, SUVs
5. SUV-heavy Chrysler has contender in midsize car battle.
SUV-heavy Fiat Chrysler Automobile’s all-new Chrysler 200 sedan is giving the company a real midsize car contender for the first time in years — even though midsize sedan sales slowed down and competitors are rolling out aggressive sales incentives.
Sales of the 200 rose faster — up 40% — than the midsize heavyweights in October. By contrast, sales rose 13.8% for the Toyota Camry, 8.1% for the Nissan Altima, 7.8% for the Honda Accord and 5.1% for the Ford Fusion. Sales of the Chevrolet Malibu fell 5.1%. The 200’s sales were only about a third of the Camry. But the Camry is the best-selling car in America, so a third is still a lot of cars for a Chrysler.
“This house has very high expectations for this car. We are not there yet,” said Al Gardner, CEO of the Chrysler brand at a recent media event. “We knew it would take longer than we would like. But selling 10,500 to 11,000 a month at this stage is exactly on plan.”
FULL STORY: Chrysler 200 claws way into midsize sedan fight