August Auto Sales A Disaster As Ford Admits "We Think Sales Have Reached A Plateau"

Tyler Durden's picture

August auto sales were pretty much a disaster this morning with every single OEM missing analyst forecasts. 

Ford executives provided the most sobering commentary on future auto sales saying they believe sales have "reached a plateau" and will be "at a lower level" in 2017.  When questioned on the notion that sales had "plateaued," Ford noted that "we're no longer in a period where we have a lot of pent-up demand coming out of the financial crisis."  Ford also noted that retail incentives continue to run at "historically high levels."  Below are some of the key comments from Ford executives describing the current conditions in the auto market:

"For the remainder of the year, we continue to see retail in the industry provide incentives still running at historically high levels, but down versus the record that we experienced in 2015.  Looking ahead to 2017, we continue to see industry sales are strong, but at a lower level than this year."

 

"Sales have reached a plateau."

 

"It's just that we're no longer in a period where we have a lot of pent-up demand coming out of the financial crisis. So that's why, I think we use the term plateau"

 

"Comparisons for the rest of the year are going to be really tough."

Ford also noted that dealer inventory ballooned to 81 days this August compared to only 62 days last year.  Moreover, fleet sales to rental companies were down 32% YoY.  Meanwhile, Ford's largest vehicle lines were all down YoY, including:  F-Series down 6.1%, Escape down 2.8%, Explorer down 15.5% and Fusion down 32.6%.

Meanwhile, GM also missed with overall sales down 5.2% vs. estimates of -4.9%.  Dealer inventory also increased for GM to 74 days from 66 days last year.  Meanwhile, GM's popular pickups were also down YoY with the Silverado down 4.7% and the Sierra down 17.7%.  

The other OEMs didn't do any better:

August 2016 Auto Sales

 

Weak sales came in spite of massive YoY increases in incentive spending with Ford, GM and Chrysler all up 18.0%, 7.9% and 16.0%, respectively. 

 

Of course things could always be worse.  Venezuela sold a total of 193 cars in July (that's 193...not in thousands...just 193) after they thought they'd plateaued from 2009 - 2013. 

Venezuela Auto Sales

 

That's the crazy thing about "plateaus" there's a cliff on both sides.

 

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Spungo's picture

Permanently high plateau? Bullish.

Hitlery_4_Dictator's picture

How is GM not down more than Ford. Oh that's right making loans to the coons with shit credit scores and zero down. 

Stuck on Zero's picture

Clearly, more production needs to be sent to Mexico.

Slomotrainwreck's picture

The problem is people. They're just not coming into the stores. If they came, we would increase sales. It's those peoples faults. We would make moneys if we could but we just can't. Why? Peoples.

TheMeatTrapper's picture

Don't forget all the GM's "sold" to the feds and paid for with our tax dollars. If it weren't for the feds and the cops buying GM's, the bail out would have gone belly up a long time ago. I've never seen a fed driving a Ford, and it's been over a decade since I've seen a cop driving one. 

johngaltfla's picture

Yup, now that the Bamster is about to leave office, you have to figure his "private trust fund" he can't touch or see is short every fucking thing and he's gonig to assrape the investing public, starting with the automakers by telling the GAO to quit buying everything until next year.

SomethingSomethingDarkSide's picture

Is that the faint whisper of a Bailout Warning we just heard?

Iam_Silverman's picture

"Cash for clunkers part two?"

That would drive me insane!

The only vehicle I have that would qualify for the program is worth as much now as when it sold new!

1995 Jeep Wrangler S in case you were wondering.  No way that one gets traded in.

divingengineer's picture

Cool down, its not like it's a Scrambler. 

 

Slomotrainwreck's picture

Cash for trade-ins part 1

snakehead's picture

Bloomberg today:

New Unemployment Claims Rise Less Than Expected.

BiteMeBO's picture

Bring back the Pinto.  

Hitlery_4_Dictator's picture

You do realize the Pinto and teh exploding tires were all made up by Journalists who wanted to make a name for themselves, right? My first car was a Pinto, it was great. My Dad was a Master Ford Mechanic, try doing some research instead of listening to fools. Pinto that exploded had the gas cap off, was parked on a shoulder and a big rig hit it going 60 mph. The explorer's were all owned by Mexicant's who never checked their air tire pressure and drove 80 mph on under inflated tires. 

ToSoft4Truth's picture

Sabrina drove an orange Pinto.  She was an Angel.  

LadiesLoveCoolJames's picture

Holy shit! Never thought I would live to meet an honest to goodness Pinto apologist. We had one too. Didn't catch on fire, but it was a steaming pile of dookie. American cars were all horrible then, but the Pinto was especially bad.

aliens is here's picture

Yo, my parents had an orange pinto station wagon. It was the best car ever. Gets high gas mileage and low maintenace. I love that car too. Stop talking shit about Ford Pinto.

Hal n back's picture

hell, my wifes contribution to marriage was a Vega.

Both were the Ford/GM answer to increasing oil prices.

BandGap's picture

I had a '74 Vega with an original aluminum block engine in grad school. It would not die but it sure was a piece of shit.

Had a Datsun B210 that rivalled it for get up and go. Another fecal ball with wheels.

Osmium's picture

Friend of mine had a Vega.  Stop at the gas station, check the gas and fill the oil.  

toady's picture

We had the off-brand version,  an "astro".... I forgot the make... Buick or gmc or something,  but the same deal, fill the oil & check the gas....

TalkToLind's picture

Pontiac Astre.  And yes, I feel your pain.

Blue Snowflake's picture

So the fuel tank was NOT easily ruptured?

http://www.popularmechanics.com/cars/a6700/top-automotive-engineering-failures-ford-pinto-fuel-tanks

Everything was going well until, deep into the development cycle, a problem was discovered in the fuel tank design. In low-speed rear-end crash testing, the fuel tank, positioned behind the rear axle and in front of the rear bumper, exhibited several flaws. Upon impact, the filler neck would tear away from the sheet-metal tank and spill fuel beneath the car. The tank was also easily punctured by bolts protruding from the differential and nearby brackets. One report later described the entire contents of a tank leaking out in less than a minute after an accident.

wisehiney's picture

My buddy had a beat up Pinto that we treated like a dune buggy.

Drive all through the woods to go fishing down at the river.

Get drunk and race around and through the oak grove at his house when we threw parties.

Etc.

Tough little car.

Hitlery_4_Dictator's picture

2.3 liter was impossible to destoy 

TheMeatTrapper's picture

An old drinking buddy had an old Ford Mustang. We called it "The Beast". It survived off roading, being rolled twice and kept running. The thing would not die. That was back when you could buy an old used car and run the hell out of it. Kids don't seem to do that kind of stuff anymore. If you slid off a dirt road and hit a tree, you backed up and kept going. 

GunnerySgtHartman's picture

Exactly right regarding the Pinto.   Despite its flaws (and it did have some), the car was no more dangerous than any other small car on the market in those days, and it was actually less dangerous than some of the cars foisted on us by the Japanese automakers and even the VW Beetle ... anyone who is interested in more details should read "The Myth of the Ford Pinto Case," which was published by the Rutgers Law Review.  It is a real eye-opener, especially when it comes to how the media fabricated things regarding the case.  It was not unlike the Chevy Truck/NBC Dateline situation.

http://www.pointoflaw.com/articles/The_Myth_of_the_Ford_Pinto_Case.pdf

Hitlery_4_Dictator's picture

I bought a used 2003 F150 King Ranch from a private seller in Alabama last year. Does that help? I plan on driving it for 10-20 years, it only has 80k miles.

Captain Chlamydia's picture

Great car. Friends have one. Pretty big btw. 

indygo55's picture

Whadya pay for that Ford F150 if you dont mind?

 

Hitlery_4_Dictator's picture

I paid 13.5 and at the time I bought it, it had only 67k miles and was a one owner truck. Thing is MINT. Everything works too. If you are going to buy a used F150 stay away from the 3 valve if you can (2004-2009), people that don't change oil regularly can mess the engine up due to very small openings that get clogged.  I love my 2 valve 5.4. Never a problem with those engines. Also, believe it or not but the older King Ranches have better seats than even the new ones, you have to maintain them more but boy you can't beat that leather. 

Chauncey Gardener's picture

I worked with a guy who drove his beatear Explorer on BALD Firestone tires who became part of the class action lawsuit against Ford after the moron drove his rig to Utah for a family reunion and killed his wife when a tire blew and he rolled and totalled the SUV. Special kind of stupid. Bogus claim to a bogus lawsuit. 

Oliver Klozoff's picture

I can't imagine the special kind of stupid that makes it OK to expect that a blow out should end up with you wiping your wifes brains off the headliner.

After a blow out you're supposed to be able to pull over and change the damn tire.

Ford design ignored engineering specs and placed bigger wheels and tires on an overloaded Bronco II platform and pushed the center of gravity outside of optimal limits, just so the truck would look cool. Then they recommended under inflating the tires in an attempt to lower it again, virtually guaranteeing tread separation at high speeds.

Instead of roasting for this(see GM and the ignition cylinder recall), John Dingalong pulled their asses from the fire.

 

http://content.time.com/time/business/article/0,8599,128198,00.html

Chauncey Gardener's picture

This clown was a special kind of stupid, and was one of the most incompetant service tech's we had in the field. He was morbidly obese, as was his wife who did not survive the crash. You think everyone can recover from a high speed blowout when ALL the tires on the vehicle were bald? I saw them (the tires) before he left on the trip, and his manager and several of his peers told him he was a fool to be driving around town, let alone hoping to go several hundred miles on bald tires. But then, he really was a special kind of stupid. His car also had bad shocks and was overdue for a brake job. It was not Firestone or Ford's "bad engineering." Try gross negligence for starters.

Kprime's picture

I opened a can of pinto just last night.  it was taco night.

2banana's picture

The Subprime auto loan bubble is about to burst

offwirenews's picture

plateau? just like home prices were going to plateau in 2008? okay sure.

Hohum's picture

Everyone knows that borrowing money to buy rapidly depreciating assets is the foundation of a solid economy.

Stormtrooper's picture

Looks like the Fiats are still flying out the door!

doc333's picture

I see what you did there...

 

Ajax_USB_Port_Repair_Service_'s picture

Fiat sales were -21.4% in August 2016 compared to August 2015.

TinyURL.com/hq6gyct
de3de8's picture

Maybe a GT 350R or new Raptor without "market adjustment" mark up on the horizon?

Theta_Burn's picture

Picked up a 2016 Ford explorer, 4-G's under list, the Mrs. loves it...

Kprime's picture

soooooo, that's what?  86K?

seriously, I'm out of touch