GM Joins Ford Posting Sales Drops Blamed on Cold Weather

General Motors Co. and Ford Motor Co., the largest U.S. automakers, reported deeper declines in deliveries than analysts estimated as the coldest January in two decades kept some shoppers from dealerships.

Sales of cars and light trucks fell 12 percent for GM and 7.5 percent for Ford, according to company statements, and the shares dropped. Toyota Motor Corp. and Honda Motor Co. also reported deliveries that declined and trailed estimates. Chrysler Group LLC and Nissan Motor Co., which reported results exceeding analysts’ projections, fielded new sport-utility vehicles that drove much of their gains.

The industry trailed analysts’ estimates that had called for the eking out of a sales increase during the coldest January in the contiguous U.S. states since 1994, according to Commodity Weather Group LLC. GM, Ford and Toyota have forecast a fifth straight year of rising deliveries in 2014 after the industry totaled 15.6 million in 2013, its best annual result since 2007, according to researcher Autodata Corp.

“GM and Ford’s concentration of sales are in the areas that were badly hit by bad weather,” Jessica Caldwell, an analyst at auto researcher, said by telephone. For Chrysler, “products like the Cherokee will continue to do well. They continue to up their product game.”

U.S. car and light truck sales slipped 3.1 percent to 1.01 million, Woodcliff Lake, New Jersey-based Autodata said in an e-mail. Deliveries trailed the average estimate from eight analysts for a 0.4 percent gain to less than 1.05 million in a survey by Bloomberg News.

Selling Rate

The annualized selling pace, adjusted for seasonal trends, matched last year’s 15.2 million cars and light trucks, trailing 14 analysts’ average estimate for a 15.7 million rate.

Chrysler, the U.S. carmaker merging with Fiat SpA, said its sales climbed 8 percent, exceeding analysts’ average estimate for a 5.4 percent gain. Nissan sales rose 12 percent, according to a statement. The Yokohama, Japan-based carmaker topped the average of seven analysts’ estimates for a 10 percent increase.

Deliveries of Chrysler’s Cherokee SUV totaled 10,505 in its fourth month in the market. While sales fell sequentially from 15,038 in December, the Auburn Hills, Michigan-based company wouldn’t have extended its streak of year-over-year gains without that model. Deliveries of Nissan’s redesigned Rogue SUV surged 55 percent to 13,831.

“This weather seems to be getting played up quite a bit, but that could be expected in January,” Reid Bigland, Chrysler Group’s head of U.S. sales, said today in a telephone interview.

‘Persevere Through’

“If we remember back to January 2013, it most certainly wasn’t sunny and 72 every day in the north,” he said. “That’s January. It’s cold and snowy. It’s icy. The wind is blowing and it’s really a horrible month in a lot of the country, but you really need to persevere through that.”

While California and the western U.S. were strong regions for Chrysler, its third-best performing area was the Great Lakes region, including Michigan, Ohio, Kentucky, Indiana and Illinois, Bigland said.

Ford shares slid 2.7 percent to $14.55 at the close in New York, while Detroit-based GM fell 2.3 percent to $35.25. Ford reached its lowest close since May 14, and GM dropped to its lowest since Oct. 23.

Sergio Marchionne, chief executive officer of both Chrysler and Fiat, will rely on two models this year to fuel profitable growth for the group: the Jeep Cherokee SUV and the revamped Chrysler 200 sedan that influential artist Bob Dylan pitched during last night’s Super Bowl.

Dylan Commercial

Dylan’s Super Bowl commercial featured a two-minute homage to America and American pride and ended with him imploring consumers to buy domestic cars. Deliveries of the outgoing 200 sedan, which will be replaced with the model featured in last night’s ad in the first half of this year, rose 23 percent in January to 10,912.

“So let Germany brew your beer, let Switzerland make your watch, let Asia assemble your phone,” Dylan, 72, said in the commercial. “We ... will build ... your car.”

Even after the better-than-estimated sales, Chrysler said its inventory rose to 105 days supply, more than the roughly 60 days that automakers generally consider ideal. Inventory also rose to 114 days for GM and 111 days for Ford as sales declined for top models including the Chevrolet Silverado and Ford F-Series pickups and the Chevy Malibu and Ford Fusion mid-size sedans.

Inclement Weather

“January got off to a pretty slow start with really inclement weather in the heartland of the country, all the way down into Texas,” John Felice, U.S. sales chief for Dearborn, Michigan-based Ford, said today on a conference call. “As things improved around the country mid-month, we saw a bounce-back in demand and sales, which was encouraging. Then, sadly, the last week of the month we saw again another arctic blast.”

The weather cost about six days of sales in January for Dorschel Automotive Group, said Tim Rinaldi, director of sales for the Rochester, New York-based chain of dealerships with vehicle brands including Toyota, Nissan and Volkswagen.

Whenever the weather forecast called for more than four inches (10 centimeters) of snow, the dealerships declared a “snow alert” and mobilized 85 sales people and 10 lot staffers to get almost 1,500 vehicles moved among eight locations for plowing the lots, he said.

Trouble Traveling

“People tend to only go where they need to go,” Rinaldi said. “Sometimes even my own employees have trouble coming in.”

Sales fell 7.2 percent for Toyota and 2.1 percent for Honda, missing analysts’ average estimates for a decline of 2.7 percent by Toyota and a gain of 4.8 percent by Honda. Deliveries plunged 27 percent for Toyota’s Camry, the top-selling passenger car in the U.S. for the last 12 years, and 14 percent for Honda’s Accord. Sales of Nissan’s Altima rose 4.9 percent to 22,515, surpassing the Accord for the month and trailing Camry by 817 vehicles.

“The Altima is really one of the better products in the mid-size segment,” Alan Baum, an industry analyst with Baum & Associates in West Bloomfield, Michigan, said today in an interview with Bloomberg Radio. “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.”


Hyundai Motor Co. and affiliate Kia Motors Corp.’s combined deliveries rose 1.3 percent in January, trailing seven analysts’ average estimate for a 2.4 percent increase. The automakers, which are based in Seoul and share a chairman, were paced by sales gains for the Elantra and Rio compact cars.

Volkswagen AG reported a 14 percent drop in combined January sales for the Wolfsburg, Germany-based company’s VW and Audi brands, a wider decline than four analysts’ average estimate of 0.6 percent.

Once the weather improves, sales will recover because of pent-up demand in the affected regions, Bob Ferguson, head of GM’s Cadillac brand, said last week in an interview at the National Automobile Dealers Association’s annual convention.

GM “would love for there to be sunshine and warm temperatures in the Northeast,” he said at the event in New Orleans, where the temperature dipped to 36 degrees (2.2 degrees Celsius) on Jan. 29. The historical average temperature for that day in New Orleans is 61 degrees, according to

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