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Mixed sales results, but automaker stocks rise on need for cars in Houston

DETROIT — The Big Three Detroit automakers on Friday reported better-than-expected August sales and issued optimistic outlooks for demand as residents of the Houston area replace flood-damaged cars and trucks after Hurricane Harvey, sending their stocks higher. General Motors, Ford and Fiat Chrysler posted mixed August U.S. sales, with GM up 7.5 percent and Ford and Fiat Chrysler down. Japanese automaker Toyota improved sales by nearly 7 percent, while Honda fell 2.4 percent. Still, analysts focused on the potential for Detroit automakers to cut inventories and stabilize used vehicle prices as residents of Houston, the fourth largest city in the United States, are forced to replace tens of thousands, perhaps hundreds of thousands, of vehicles after the devastation from Hurricane Harvey. Mark LaNeve, Ford's U.S. sales chief, told analysts on Friday that following Hurricane Katrina in 2005 "we saw a very dramatic snapback" in demand. That said, Ford sales fell 2.1 percent in August. It sold 209,897 vehicles in the United States, compared with 214,482 a year earlier. Sales were down 1.9 percent in the Ford division and off 5.8 percent at Lincoln. Demand was down for cars, crossovers and SUVs. It was not clear how many vehicles in the Houston area will be scrapped, LaNeve said, saying he had seen estimates ranging from 200,000 to 400,000 to 1 million. Ford's Houston dealers may have lost fewer than 5,000 vehicles in inventory, he said. Ford is the No. 1 automaker in the Houston market, with 18 percent share, according to IHS Markit. The company plans to ship used vehicles to Houston dealers and has "every indication we would have to add some production" of new vehicles to meet demand, LaNeve said. Investor concerns about inventories of unsold vehicles and falling used car prices have weighed on Detroit automakers' shares most of this year. Now, automakers can anticipate a jolt of demand from a big market that is a stronghold for Detroit brand trucks and SUVs. "It's got to be a positive for the industry," LaNeve said. Investors appeared to agree. GM shares rose as much as 3.3 percent to their highest since early March. Ford increased 2.8 percent at $11.34, and Fiat Chrysler's U.S.-traded shares were up 5.2 percent $15.91, hitting their highest in more than five years. GM reported a 7.5 percent increase in U.S. auto sales in August, helped by robust sales of crossovers across its four brands.

Ford bringing production F-150 to Detroit with Atlas styling and Alcoa blast shields

According to a report in Bloomberg, the 2015 Ford F-150 will indeed be showing up at the Detroit Auto Show next month. It will bring attitude with it, not only in the form of sheetmetal inspired by the Atlas concept (pictured) that appeared at the 2013 Detroit show but also in the Alcoa military blast shields among the display being used to showcase the ruggedness of aluminum.
There's been a lot of talk about the F-150 switching to aluminum body panels (although maintaining a steel frame), and for good reason. The lightweight body is expected to shed more than 700 pounds and greatly increase its highway mileage, but production-line issues and possible delays have been a major focus of attention concerning the best-selling vehicle in America for 32 years, meaning Ford has to get it right. F-150 is responsible for a massive portion of the company's global profits and it will come in a year when company profits are already predicted to decline because of new car launches.
When it comes to dings, the Bloomberg story says Ford wants Alcoa to supply some of the military-grade aluminum it uses for blast shields on battlefield vehicles to help it talk up the toughness of aluminum. Reading commentary on the many stories about the F-150 reveals there are many more little questions about the aluminum overhaul, like "How much will it cost to repair and insure?" and "How will companies hang their magnetic signs?" Answers should start coming in a couple of weeks.

Want a V8 on the cheap? Buy a work truck

In case you didn't notice, V8 cars have gotten pretty expensive. If you want a modern muscle car like the Dodge Challenger R/T, Ford Mustang GT, or Chevy Camaro SS, you'll need between $34,000 and $38,000 for a stripped out example of one. The cheapest of those is the Challenger, and the priciest is the Camaro. These are also the cheapest V8 cars the companies offer. But if you absolutely have to have a V8 for less, there is an option, work trucks. As it turns out, all of the Big Three offer their most basic work trucks with V8s. And because they're so basic, they're pretty affordable, especially when sticking with the standard two-wheel drive. A Ram 1500 Tradesman with a V8 can be had for as little as $29,840, which is a little more than $4,000 less than a Challenger R/T. For a bit more at $30,275, you can have a Chevy Silverado W/T, almost $8,000 less than a Camaro SS. The most expensive is the V8 Ford F-150 starts at a starting price of $30,670, which is a bit over $5,000 less than the Mustang. Of course you'll be in an ultra bare bones vehicle with few comforts, and the price will go up if you add stuff, but we're bargain hunting here, and sacrifices are sometimes necessary. Besides, what you lose in comfort, you gain in loads of cargo space and towing (try to look at the bright side). Also, as a side note, all three trucks are available with optional electronic locking rear differentials. At the discounted price of these trucks, you still get a heaping helping of power. The most potent of the trio is the Ram 1500 Tradesman with 395 horsepower and 410 pound-feet of torque generated by a 5.7-liter V8. Compared with the Challenger R/T, the Ram is up by 20 horsepower and they're tied for torque. The value proposition is even more stark between the two vehicles when looking at the price per horsepower. Each pony in the Ram costs $75.54, while the Challenger charges you $90.91. The Challenger is also more expensive per horsepower than its close competitors. The F-150's 5.0-liter V8 is just barely behind the Ram with 395 horsepower and 400 pound-feet of torque. That's still more power than the Challenger, and it matches the torque of the 2017 Mustang GT. On the down side, it still would be down 20 horsepower on that same 2017 Mustang, and it's behind by 60 horsepower and 20 pound-feet on the new 2018 Mustang GT. The F-150 also just edges out the Mustang in the dollar per horsepower measure.