Sandy Affects October Sales; Industry Responds
While the storm had a big impact on the worst time of the month for auto sales and will continue to affect the industry in the short term, the essentially strong fundamentals continue with most companies selling in the U.S. reporting good numbers.
Toyota, Honda, the Korean brands, General Motors, Volkswagen and luxury brands all reported positive sales (Ford was even with last year.)
Chrysler Group LLC reported U.S. sales of 126,185 units, a 10% increase versus last year, with Fiat up 89%. While Nissan's eponymous brand saw a 3.2% slip, luxury brand Infiniti's vehicles were up 27.6%.
While overall Ford sales were flat with last year, their sales of small cars, including the Escape compact crossover, were the strongest for October in 11 years – with a 54% percent increase year over year. And sales of the F-Series were its best since 2004.
Toyota reported monthly sales of 155,242 units in the U.S. in a 15.8% increase; American Honda announced an 8.8% increase versus October last year, with the Honda division seeing an 8.7% and Acura a 9.4%. Kia reported its best-ever October in the U.S.
But the hurricane definitely put a brake on sales at the end of the month, which is when they are typically strongest, notes TrueCar chief analyst Jesse Toprak. "We didn't think it would affect sales, but it had a significant impact. People stopped buying things big, and that began even before the storm arrived," he says. "It hit at the worst possible time for auto sales." Toprak says for some retailers, the last few days account for some 40% of monthly sales.
But the shortfall wasn't huge in the scheme of things -- 20,000 to 30,000 units. And he says the long-term impact will be net positive because when insurance pays out for flood and flood-related damage people will rush to dealerships to replace ruined vehicles. But that will really pick up in about 60 days, per Toprak. "That's the cycle, but some will buy in two weeks, some in two months.
A couple of automakers and probably more later are sweetening the pie: Nissan is offering employee pricing to those affected. Ford Motor Company is offering customers in the Mid Atlantic and Northeast $500 Bonus Cash savings off vehicle MSRP toward the purchase or lease of any eligible 2012 or 2013 model year Ford or Lincoln vehicle.
Also Ford Credit is, through its Disaster Relief Program, letting qualified customers delay one or two monthly payments, resuming their regular payment schedules when their situations improve.