U.S. auto sales fall for fourth straight month in June
Automakers’ shares rose, however, as retail sales to consumers were relatively stable at the U.S. automakers, with General Motors Co (GM.N) asserting that the industry was set for a stronger finish to the year.
Industry consultant Autodata put the industry’s seasonally adjusted annualized rate of sales at 16.51 million units, which was the lowest rate since February 2015. It came in below Wall Street expectations of 16.6 million vehicles and 2 percent lower than the June 2016 figure.
U.S. consumers continued to shun passenger cars in favor of larger pickup trucks, SUVs and crossovers. Passenger car sales were also hurt as some automakers, including GM, have moved to reduce relatively low-margin sales to rental agencies.
The U.S. auto industry has been bracing for a downturn after hitting a record 17.55 million new vehicles sold in 2016. A glut of nearly new used vehicles poses competition for new vehicle sales and automakers have relied increasingly on consumer discounts and loosened lending terms.
Car shopping website Edmunds said the average length of a car loan reached a record high of 69.3 months in June.
“It’s financially risky, leaving borrowers exposed to being upside down on their vehicles for a large chunk of their loans,” said Jessica Caldwell, Edmunds’ executive director of industry analysis.