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June light vehicle sales delivered a month of mixed messages. Total sales were up 2.4% to slightly better than 1.51m, thanks to an extra selling day, but the seasonally adjusted annualised rate (SAAR) came in at 16.66m, 340,000 units below June 2015. As we’ve noted previously, year over year comparisons are going to be tough for the balance of 2016.

For the first half of the year, automakers have delivered 8.64m cars and light trucks, a 1.4% gain, but the cost of those sales is increasing. Estimated June incentive spending was up 8.6% to an average of US$3,116 (about GBP2,352). estimates that Fiat Chrysler (FCA) took the lead among the major automakers, putting an average of more than $4,100 (GBP3,092) on the hood of every vehicle sold. GM was not far behind and Ford boosted its spending by 35.5%.

Based on manufacturers’ reported sales, the passenger car market share dropped below 40% in June as sales of crossovers, utilities, minivans and trucks continued their domination. Total CUV/SUV June sales were within 3,332 units of equaling total car deliveries and only about two tenths of a point separates the shares of the two segments.

Competition for truck sales remains a tight race: less than 3,300 sales separate GM, Ford and FCA. While GM has the lead in total light truck sales, it doesn’t lead in any category. Ford leads the market in pickup and commercial van sales while FCA has a lock on the utility and minivan segments.

The minivan segment, while still small, is the fastest-growing segment in the US market and FCA could be faced with a real conundrum next year. The Dodge Grand Caravan is scheduled to go out of production, leaving the Chrysler Pacifica as FCA’s sole entry. The problem is that, as of the end of June, sales of the Grand Caravan are about equal to the combined volumes of the Pacifica and Town & Country in the US. In the Canadian market, the second-largest for FCA minivans, the Dodge sells 22 times better than the Chryslers. 

The Detroit and Korean automakers gained market share at the expense of the Japanese and German companies. Toyota slipped into the red for the first six months of 2016, weighing heavily on sales of Japanese cars, while deficits at BMW and Volkswagen swamped strong months from Jaguar Land Rover and Volvo.

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By GlobalData

The Nissan brand reported a June sales record as Nissan North America blew past American Honda to take the fifth spot for both June and the first half of the year.

On the subject of records, FCA reported its 75th consecutive month of year over year sales gains; Audi set its 66th consecutive sales record and Subaru hit 55 months of continuous growth. Kia posted a new June sales record and Hyundai did the same with a margin of nine units.

While the US market still looks to be on track for a new annual sales record,  there is a growing concern about the amount of money being spent on what amounts to bringing future sales forward. Record financing terms, low priced leases and incentives running close to 10% of the average transaction price are habits that may be hard to break for both automakers and consumers when the inevitable market correction occurs.

* indicates a sales record.

**Volkswagen Group figures include Audi, Bentley, Porsche and Volkswagen brands

Other includes estimated sales for Aston-Martin, Ferrari, Lamborghini, Lotus, Rolls-Royce and Tesla

Source: Manufacturer’s reported sales

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