U.S. auto sales rose slightly in October, hit by rising interest rates and higher vehicle prices, and No.2 carmaker Ford Motor Co. warned of slipping consumer confidence, indicating sales volumes would continue to moderate in what remains of 2018.
Ford on Thursday reported a 5 percent decline in sales for its pickup trucks, while overall sales fell 3.9 percent to 192,616 units in October, hurt by lower passenger-car demand.
Ford said consumers are relatively confident about economic conditions, albeit slightly less so than in September, citing data for October from University of Michigan’s consumer sentiment index, adding payments have crept up with rising interest rates.
The number of respondents in the index saying that it was a good time to buy a car fell 8 points from September to 59 percent on higher concerns about vehicle prices and interest rates, Ford added.
“Interest rates are taking payments up along with our transaction pricing. So little bit of pressure there,” said Mark LaNeve, vice president, U.S. marketing, sales and service at Ford.
Ford’s transaction prices increased by $1,400 in October from a year ago, compared with $330 for the overall industry.
SUVs were a bright spot for Ford, contributing about 35 percent of its total U.S. sales volumes in October, up from 31.6 percent a year ago. Standouts were the Expedition, Explorer and Lincoln Navigator.
The carmaker said its gross stock increased to 87 days from 79 a year ago, as its dealers anticipated more vehicle demand in November and December. The industry sees 60-65 days of inventory as healthy.
U.S. car sales, which dropped 2 percent last year from a record high of 17.55 million in 2016, are expected to fall further in 2018, hurt by rising interest rates and the return of more late-model used cars to dealer lots.
But automakers have been helped as more U.S. consumers shift away from traditional passenger cars to larger SUVs and trucks, which tend to be more profitable for producers.
Some other automakers’ results:
Fiat Chrysler Automobiles: U.S. sales rose 16 percent in October on higher demand for Jeep and Ram.
Toyota: U.S. sales rose about 1.4 percent to 191,102 units, due to increased demand for Highlander and Tacoma SUVs.
Honda: U.S. sales fell 4 percent to 122,182 vehicles, on weaker demand for passenger cars.
Nissan: Sales fell 10.6 percent to 109,962 vehicles.
BMW: Sales increased 0.2 percent in October 2018 for a total of 23,262. Year-to-date, BMW is up 2 percent on sales of 248,327 vehicles compared with the same 10-month period in 2017.
Volvo: U.S. sales were 7,327 vehicles, up 4.6 percent vs. October 2017. Year-to-date, Volvo has soldsold 81,256 vehicles in the U.S., up 27 percent.
Kia: October sales were up 1.5 percent. Sales so far in 2018 were down by 1 percent.
Volkswagen: Up 4.6 percent October over October, up 5.6 percent so far this year with 295,228 vehicles sold.
Earlier this year, No. 1 U.S. automaker General Motors Co switched to reporting sales quarterly instead of monthly.
Reporting by Rachit Vats and Ankit Ajmera