Toyota Leads Asian Carmakers’ U.S. Slide in January Freeze

Toyota Motor Corp. (7203) and Honda Motor Co. (7267) reported lower U.S. sales than analysts estimated as the coldest January in 20 years contributed to a drop in deliveries for most Asia-based automakers and the industry.

Deliveries for Toyota, the world’s largest automaker, fell 7.2 percent from a year earlier, wider than the 2.7 percent drop that was the average of seven estimates compiled by Bloomberg. Honda sales dipped 2.1 percent as analysts expected a gain of 4.8 percent. Nissan Motor Co. (7201) was alone among large Asian carmakers in beating expectations, with a 12 percent increase, compared with the 10 percent projection.

“Everybody’s saying that it was weather-related, and that’s true,” Alan Baum, an analyst at Baum & Associates in West Bloomfield, Michigan, said in a Bloomberg Radio interview yesterday. “January is always a bit of a slow month because of the incentives in December. Nissan is a little bit of a sleeper.”

U.S. sales of new cars and light trucks, after rising for a fourth straight year in 2013 to 15.6 million, began 2014 with a 3.1 percent monthly decline, according to Autodata Corp. It was the coldest January in the contiguous U.S. states since 1994, according to Commodity Weather Group LLC, and some areas also had heavy snow. Toyota, Honda, Nissan and other automakers still forecast annual industrywide sales of about 16 million vehicles.

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Honda Motor Co. Acura MDX vehicles sit on display at the Acura of Troy dealer in Troy, Michigan. Close

Honda Motor Co. Acura MDX vehicles sit on display at the Acura of Troy dealer in Troy, Michigan.

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Honda Motor Co. Acura MDX vehicles sit on display at the Acura of Troy dealer in Troy, Michigan.

Among U.S. automakers, sales slid 12 percent for General Motors Co. and 7.5 percent for Ford Motor Co., while Chrysler Group LLC joined Nissan in exceeding estimates, with an increase of 8 percent.

Camry Decline

Toyota delivered 146,365 Toyota, Lexus and Scion vehicles last month, down from 157,725 a year earlier. The decline for the Toyota City, Japan-based company was led by a 27 percent drop in sales of Camry sedans, the best-selling U.S. car for the past 12 years.

Toyota’s Lexus luxury brand posted an 8.8 percent increase on higher sales of RX sport-utility vehicles, while deliveries for the main Toyota brand slid 9 percent, the company said.

“Our sales were actually up in all western and southern areas,” Bill Fay, Toyota’s U.S. group vice president, said on a conference call yesterday. “That couldn’t offset the losses we had in middle America and the East Coast, the areas that were hit hardest by the storms.”

Market share for Toyota, the third-largest automaker in the U.S. by volume, fell to 14.5 percent in January from 15.1 percent a year earlier, according to Woodcliff Lake, New Jersey-based Autodata.

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Toyota Motor Corp. signage is displayed at the DCH Auto Group Dealership in Torrance, California.

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Toyota Motor Corp. signage is displayed at the DCH Auto Group Dealership in Torrance, California.

Fabric Fixes

Shares of Japanese automakers fell amid a drop in the benchmark Nikkei 225 Stock Average. (NKY) Toyota declined 4.7 percent to 5,562 yen at 10:16 a.m. in Tokyo trading, Honda fell 3.5 percent to 3,675 yen and Nissan dropped 3.6 percent to 841 yen.

Fay also told reporters that a temporary sales halt of some versions of Camry and Avalon sedans, Corolla small cars, Sienna minivans and Tacoma and Tundra pickup trucks had little effect on January sales and should be “minimal” this month.

The vehicles affected, which Toyota said last week contain material around seat heaters that doesn’t meet U.S. fire safety standards, are being repaired, Fay said. The autos being fixed represent “about 10 percent our inventory,” he said.

Honda delivered 91,631 Honda and Acura vehicles last month, a drop from 93,626 a year earlier. The company’s Accord, a perennial Camry competitor, dropped to fourth in mid-size car sales behind Camry, Nissan’s Altima and Ford’s Fusion.

‘Snow Miser’

The 14 percent decline in Accord sales may be related to Honda spending less to lure buyers, as well as to the weather, said Larry Dominique, president of ALG Inc., a Santa Barbara, California-based company that sets vehicle residual values.

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Line technician Jeremy Howard checks the interior paint finish on a vehicle at the Nissan Motor Co. manufacturing facility in Smyrna, Tennessee, U.S.

“With the Accord, we did see a lack of incentive increase last month,” he said. “In that segment, no matter which brand I talk to, from a transaction price point, the big volume vehicles are now bunched up in a pretty tight band.”

Market share for Honda, which ranks fifth in U.S. sales, was unchanged from a year earlier at 9 percent.

Nissan sold 90,470 Nissan and Infiniti vehicles last month, up from 80,919. The Yokohama, Japan-based company cited a surge in Rogue crossover sales and continued increases for the Frontier small pickup and Leaf electric hatchback.

“The snow miser was definitely out there and creating hazards for everyone,” Fred Diaz, Nissan’s U.S. senior vice president, said in a phone interview. The carmaker’s better-than-expected results resulted from both new models and improved “dealer engagement,” he said.

In addition to the company’s Altima sedan beating Honda’s Accord in sales last month, Nissan’s namesake division topped the Honda brand in January deliveries.

Hyundai, Kia

“The Altima is really one of the better products in the mid-size segment,” Baum said. “It doesn’t get the attention because of the Camry and the Accord competition at the top, and with the Fusion being the star for design, but the Altima has soldiered along and it has incredibly good fuel economy.”

Nissan’s market share rose to 8.9 percent last month from 7.7 percent a year earlier, according to Autodata.

Hyundai Motor Co. (005380) and affiliate Kia Motors Corp. (000270)’s combined deliveries rose 1.3 percent in January, missing the 2.4 percent increase that was the average of seven estimates. Sales climbed 0.7 percent to 44,005 for Hyundai and 2 percent to 37,011 for Kia, the Seoul-based companies said in separate statements.

Subaru, the auto unit of Fuji Heavy Industries Ltd. (7270), reported a 19 percent sales increase last month, delivering 33,000 cars and crossovers.

Japan’s Mazda Motor Corp. said sales fell 12 percent to 18,813, while Mitsubishi Motors Corp. posted a 4.5 percent increase to 4,867.

To contact the reporter on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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