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Sales incentive growth clustered around brands with few CUVs, trucks

While it's arguably been around the longest, the dominance of the four-door sedan has been under threat for many years. As a further sign of the hurtin' that SUVs and crossovers have put on today's four-doors, a new report from Automotive News points to the increasing use of incentives by brands reliant on cars and light on CUVs and pickups.
Honda, Toyota, Volkswagen and Kia have all been stung by double-digit increases in their incentives-to-transaction price ratio, according to AN, which cites data from TrueCar. Honda's ratio is up 14 percent, while Toyota, VW and Kia are up 18, 15 and 19 percent, respectively.
"Most of the incentive growth we have seen is in product segments with low demand - midsized or large sedans," TrueCar CEO John Krafcik told AN. "As this trend goes on, the brands with three-sedan strategies are going to be in worse shape on incentive spending than the crossover brands."

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.

Honda worker dies in forklift accident at Ohio R&D complex

Ghouse Gulam, a contract worker at the Honda R&D Americas complex in Raymond, OH, died January 4 after being hit by a forklift and suffering a skull fracture. Union County Sheriff's Office Lieutenant Michael Justice tells Autoblog that this is still an open investigation, but there are no pending charges. He said it could be about three months for the authorities to make a final determination until the coroner's report is complete. According to Automotive News, the accident happened between two buildings on the site's campus, and the forklift was carrying an empty trash bin when it struck Gulam. A media release (as a PDF) from the Union County Sheriff's Office showed that police responded at 6:01 AM. Justice would not reveal the name of the driver, but said that the person had retained legal council. The US Occupational Safety and Health Administration also opened an investigation, according to AN. In a statement (in full below), Honda expressed sympathy to Gulam's family. "Associates of Honda R&D Americas are deeply saddened and extend heartfelt sympathy and condolences to family members, friends and colleagues." On Monday, January 4, 2016, at approximately 6:00 a.m. Ghouse Gulam, a contract worker at Honda R&D Americas, Inc. in Raymond, Ohio, was injured in an accident involving a forklift driven by another contract worker. On-site emergency personnel responded immediately to the incident, followed by emergency responders from the Raymond, Ohio based Liberty Township Fire Department. Mr. Gulam was transported by Liberty Township Fire to Memorial Hospital of Union County where he later passed away. Mr. Gulam, 61, was a resident of Livonia, Michigan. Local law enforcement officials were notified of the incident. With respect for the privacy of Mr. Gulam and his family, no additional details will be provided. Associates of Honda R&D Americas are deeply saddened and extend heartfelt sympathy and condolences to family members, friends and colleagues.