The 16-day federal government shutdown in early October appeared to dampen consumers’ appetite for new cars, as seven of the top eight automakers reporting monthly sales on Friday missed analysts’ expectations.
Industry sales in October rose 10.6 percent to 1.2 million vehicles, according to the industry research firm Autodata. Analysts had expected a 12 percent increase.
Sales for the three Detroit-based automakers, driven partly by steady demand for full-size pickup trucks, rose by double digits from a year earlier, but only General Motors beat expectations.
October sales dipped to an annual rate of 15.23 million vehicles, according to Autodata, the lowest rate since April.
The weaker-than-expected sales rate “was primarily driven by the government shutdown impacting consumer sentiment through the first half of the month,” Morgan Stanley analyst Adam Jonas said Friday in a briefing note to clients.
Analysts had forecast stronger performances in October from Ford Motor and Chrysler, as well as from Toyota, Honda, Nissan, Hyundai and Volkswagen.
Sales of full-size pickups, buoyed by a steady housing market and lower gasoline prices, continued to show strength in October, although their torrid year-long pace slowed a bit.
Ford’s F-series was up 13 percent for the month and up 20 percent for the year to date, while Chrysler’s Ram was up 18 percent for the month and 23 percent for the year to date. The Chevrolet Silverado was up 10 percent for the month and 20 percent for the year.
Average transaction prices for all full-size trucks in October jumped more than 5 percentage points from a year ago, to $39,189, according to Kelley Blue Book.
“The truck segment will remain hotly contested through the rest of this year,” said analyst Alec Gutierrez of Kelley Blue Book, with GM spending less than Ford and Chrysler to promote its Silverado and Sierra.
Consumer demand for electrified vehicles remain mixed. October sales of GM’s Chevrolet Volt dropped 32 percent to 2,022, while Nissan Leaf climbed 27 percent to 2,002.
With the U.S. economy still in low gear and the next round of congressional budget and debt negotiations looming in early 2014, analysts remain mixed in their longer-range outlook.
“If we could ever get some strong economic footing in this country to drive lower unemployment [and higher consumer] confidence, I think we’ve got a dam that’s still waiting to burst,” said Karl Brauer of Kelley Blue Book.