Auto sales in the U.S. declined to its lowest monthly rate in April 2013

Article by Christian Andrei, on May 3, 2013

Auto sales in the U.S. declined to its lowest monthly rate in April since last autumn as commercial sales dropped and as foreign companies posted lacklustre figures. April 2013 marks the first time since October 2012 that monthly sales in the U.S. decreased to below 15 million vehicles on a seasonally adjusted annualized rate.

According to research firm Autodata Corp, the industrywide U.S. sales achieved a pace of 14.92 million vehicles in April. Alec Gutierrez, analyst with Kelley Blue Book, said that sales are slightly below expectations but that they remain quite strong. He added that from what they’ve observed in the past two years, it appears that the auto industry will stay as of the few bright spots in the wider economy aside from housing.

Several analysts think that lower sales to commercial customers can’t be automatically considered a negative thing for the U.S. auto industry since there has been a rise in sales to consumers, a segment that is more profitable. But then, General Motors Co is worried that Japanese and South Korean automakers will increase incentive spending in the coming months, which may compel other automakers to do the same just to remain competitive.

Kurt McNeil, GM's chief of U.S. sales, said that it has noticed that Japanese and Korean manufacturers have become more aggressive. He emphasized that GM is only working to stay “competitive and disciplined." Since the automotive industry’s crisis in 2008, the big three U.S. automakers have raised per-vehicle profit partly by reducing spending on incentives. Automakers give incentives to dealers or directly to consumers whether through lower financing rates or cash rebates that lessen the cost of purchasing a new vehicle.

Topics: united states, sales

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