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Trucks, SUVs drive U.S. October new vehicle sales

DETROIT — Major automakers posted mixed U.S. new vehicle sales in October on Wednesday, though America's love affair with high-margin pickup trucks and SUVs remained in full bloom as larger, pricier vehicles fared better than passenger cars. Auto industry publication WardsAuto put the seasonally-adjusted annualized rate (SAAR) for light vehicle sales in October at a robust level of 18 million units. But after a long boom cycle, carmakers are still ill-prepared for the slight decline in sales anticipated for full-year 2017 and have taken too few steps to trim production, said Doug Mehl, a partner in consultancy A.T. Kearney's automotive practice. "When you make a new vehicle, you have volume assumptions tagged to it, and who wants to be the guy who says, 'I'm going to make less of this really cool model'?" Mehl said. "But eventually the market is the reality, and it's going to force companies one way or other here." General Motors GM reported a sales drop of 2.2 percent for the month, with consumer sales down 6.6 percent. But sales of high-margin pickup trucks, sport utility vehicles and crossovers all rose. GM also cut its inventory of unsold vehicles — a source of concern for the market — slightly. The automaker has worked to reduce its volume of excess inventory, including through significant production shutdowns in the third quarter. GM had said its inventory would rise in October. "We are heading into the fourth quarter with good momentum, thanks to a strong U.S. economy and very strong pickup and crossover sales," said Kurt McNeil, GM vice president for U.S. sales operations. GM slightly reduced consumer discounts as a percentage of average transaction prices to 13.5 percent, from 13.7 percent in the third quarter. Industry experts believe consumer discounts above 10 percent of the average transaction price are unhealthy as they erode resale values and are unsustainable in the long term. Consultants J.D. Power and LMC said last week that based on preliminary October sales numbers, discounts have exceeded 10 percent in 15 of the past 16 months. Ford The U.S. auto industry posted record sales of 17.55 million vehicles in 2016. New sales received a strong boost in September as consumers replaced vehicles damaged in southeast Texas by Hurricane Harvey the previous month. Full-year 2017 sales are expected to be slightly lower than 2016.

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.

Japan wants to boost fuel-cell numbers 100x by 2020

How many hydrogen refueling stations will Japan need? Can each station handle 250 fuel-cell vehicles? They can in the Japanese government's new plans for hydrogen fuel-cell vehicle growth and station deployment throughout the country. With Prime Minister Shinzo Abe continuing to trumpet fuel cells as the advanced powertrain of the future, the government says the number of fuel-cell vehicle on its roads will multiply by 100 within the next four years, according to the Japan Times. Specifically, Japan, which is home to about 400 fuel-cell vehicles today, hopes to have 40,000 by 2020 and a whopping 800,000 by 2030. More importantly, Japan has 80 stations either in operation or slated to be deployed soon, and hopes to double that number by the end of the decade. For perspective's sake, the US has about two-dozen publicly accessible hydrogen fuel cell stations today, according to US Department of Energy. The newer ones are can dispense 100 kilogram a day, which can fuel 20-25 cars a day. Japanese automakers Honda and Toyota appear to be trying to do their parts in the H2 plan. Earlier this month, Honda started leasing its Clarity fuel-cell vehicle in Japan and is planning to bring them to California later in the year. The vehicle, which is priced at about $68,000 in Japan, is said to be able to travel about 466 miles on a full hydrogen tank, per the more lenient Japanese driving cycle (roughly 300 miles on the US scale). Honda will start production at a rate of 200 vehicles a year. With skin in the game, though, Honda indicated late last year that it was frustrated with what it said was the slow pace of fuel-cell station deployment in Japan, according to Bloomberg News. Honda was collaborating with hydrogen supply company Iwatani Corp. on what they called a "Smart Hydrogen Station," though that concept was in its testing phase as of last December. The Mirai also started sales in Japan and debuted in limited numbers in California last year. Last fall, Toyota set a rather lofty goal of selling 30,000 fuel-cell vehicles a year by 2020 as part of its Toyota Environmental Challenge 2050. Related Video: News Source: Japan TimesImage Credit: YOSHIKAZU TSUNO via Getty Images Green Honda Toyota Hydrogen Cars