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The next steps automakers could take after sales drop again in April

DETROIT (Reuters) - Major automakers on Tuesday posted declines in U.S. new vehicle sales for April in a sign the long boom cycle that lifted the American auto industry to record sales last year is losing steam, sending carmaker stocks down. The drop in sales versus April 2016 came on the heels of a disappointing March, which automakers had shrugged off as just a bad month. But two straight weak months has heightened Wall Street worries the cyclical industry is on a downward swing after a nearly uninterrupted boom since the Great Recession's end in 2010. Auto sales were a drag on U.S. first-quarter gross domestic product, with the economy growing at an annual rate of just 0.7 percent according to an advance estimate published by the Commerce Department last Friday. Excluding the auto sector the GDP growth rate would have been 1.2 percent. Industry consultant Autodata put the industry's seasonally adjusted annualized rate of sales at 16.88 million units for April, below the average of 17.2 million units predicted by analysts polled by Reuters. General Motors Co shares fell 2.9 percent while Ford Motor Co slid 4.3 percent and Fiat Chrysler Automobiles NV's U.S.-traded shares tumbled 4.2 percent. The U.S. auto industry faces multiple challenges. Sales are slipping and vehicle inventory levels have risen even as carmakers have hiked discounts to lure customers. A flood of used vehicles from the boom cycle are increasingly competing with new cars. The question for automakers: How much and for how long to curtail production this summer, which will result in worker layoffs? To bring down stocks of unsold vehicles, the Detroit automakers need to cut production, and offer more discounts without creating "an incentives war," said Mark Wakefield, head of the North American automotive practice for AlixPartners in Southfield, Michigan. "We see multiple weeks (of production) being taken out on the car side," he said, "and some softness on the truck side." Rival automakers will be watching each other to see if one is cutting prices to gain market share from another, he said, instead of just clearing inventory. INVESTORS DIGEST BAD NEWS Just last week GM reported a record first-quarter profit, but that had almost zero impact on the automaker's stock. The iconic carmaker, whose own interest was once conflated with that of America's, has slipped behind luxury carmaker Tesla Inc in terms of valuation.

2013 Nissan GT-R and 2013 Alpina B6 mix it up on track and street

Here we have Autocar making an unforeseen comparison: the Nissan GT-R against the Alpina B6 at Brands Hatch and on public roads. Steve Sutcliffe clobbers the circuit in the 3,828-pound, all-wheel-drive sports car, then sees how well the 4,114-pound, rear-wheel drive grand tourer does against it.
Sutcliffe says there are quite a few similarities between the two cars, but that's really only on the spec sheet. The Nissan's got two turbos attached to its 3.8-liter V6, 542 horsepower and 465 pound-feet of torque. The Alpina's got two turbos attached to its 4.4-liter V8, 532 hp and 528 lb-ft. But one's brief is to be a monster on the track, the other on the boulevard, and if there's anything the video demonstrates, it's each car's focus.

Fiat contemplating sub-brand to compete with Dacia, Datsun

You can add Fiat to the admittedly short list of automakers considering a low-cost brand to rival Dacia. The inexpensive Eastern European brand from Renault-Nissan has performed on the balance sheet like a premium model line, and the money the alliance is taking off the table is encouraging other players to deal themselves in. Pretty soon Nissan's Datsun sub-brand will join the Dacia party, going on sale in Russia, Indonesia and India and will claim even more rubles, rupiahs and rupees for the parent company. Volkswagen recently said it will make a decision this year on a budget line for the Chinese market. With the euthanasia of Lancia and plans to move the Fiat brand upmarket, company CEO Sergio Marchionne wonders aloud to Automotive News Europe whether there could be room for a new budget brand underneath Fiat.
We're told that the initiative has been in the idea box for five years and even moved to the stage of name considerations, like Innocenti, but worries about profit kept it from realization. If such a range were to be developed, Marchionne says it couldn't be built in Italy and stay within budget, and the company is "analyzing its manufacturing capacity outside of Europe to see if a low-cost brand is viable."