Auto sales totaled 16.14 million in August, down nearly 2 percent from 17.22 million last August, according to Autodata.
Still, the Big Three Detroit automakers reported better-than-expected August sales and issued optimistic outlooks for demand as residents of the Houston area replace flood-damaged cars and trucks after Hurricane Harvey, sending their shares higher.
General Motors, Ford and Fiat Chrysler posted mixed August U.S. sales, with GM up 7.5 percent and Ford and Fiat Chrysler down. Japanese automaker Toyota improved sales by nearly 7 percent, Honda‘s sales fell 2.4 percent.
Still, analysts focused on the potential for Detroit automakers to cut inventories and stabilize used vehicle prices as residents of Houston, the fourth largest city in the United States, are forced to replace tens of thousands of vehicles after the devastation from Hurricane Harvey.
Mark LaNeve, Ford’s U.S. sales chief, told analysts on Friday that following Hurricane Katrina in 2005 “we saw a very dramatic snapback” in demand. Ford sales fell 2.1 percent in August.
It was not clear how many vehicles in the Houston area will be scrapped, LaNeve said, saying he had seen estimates ranging from 200,000 to 400,000 to 1 million. Ford’s Houston dealers may have lost fewer than 5,000 vehicles, he said.
Ford is the No. 1 automaker in the Houston market with 18 percent share, according to IHS Markit. The company plans to ship used vehicles to Houston dealers, and has “every indication we would have to add some production” of new vehicles to meet demand, LaNeve said.
Investor concerns about inventories of unsold vehicles and falling used car prices have weighed on Detroit automakers’ shares most of this year. Now, automakers can anticipate a jolt of demand from a big market that is a stronghold for Detroit brand trucks and SUVs.