Foreign auto manufacturers reported neutral results in U.S showrooms in January. The consumers are floating in confidence due to easy credit option, increase in the stock market and relative decrease in gas price, followed by the presidential election. This has raised the number of sales in vehicle industry during the month of January.
Since the auto manufacturers were enjoying the profits after selling 17.55 million vehicles in 2016, the industries other than automobile expected that they will attain the third consecutive full year record in U.S sales. In general, many consumers do embrace crossovers, sport-utility vehicles and pickup trucks. This trend severely criticized the Japanese automaker Toyota in January, and hence they faced 11.3 % fall in the sales, compared to the last year.
Michelle Krebs, an analyst in Autotrader, said that “Toyota doesn’t typically adjust the incentives during the month of January to boost their sales, and this may be the reason for company’s shortfall”. Beyond the expectation, Nissan the competitor of Toyota has reported 6.2 % increase in sales due to the sale volume of Rogue. Krebs said that this is due to aggressive adjustment in discounts by Nissan.
According to ALG’s TrueCar, Toyota’s average incentive per vehicle is only $2,538 in January, whereas Nissan’s is $4,335. This sale volume is also due to easy credit option i.e. about 10% of all new-car loans in January were interest-free. With high discounts, Volkswagen dealers are grabbing more success.