The slump in US auto sales extended into July with the so-called Big Three carmakers reporting declines that were worse than expected.
Here’s the scoreboard of year-on-year sales:
- GM: -15% (-8% expected)
- Ford: -7.4% (-5.5% expected)
- Fiat Chrysler: -10.5% (-6.1% expected)
- Toyota: +3.6% (-3.8% expected)
- Porsche North America: +0.6%
- Mitsubishi North America: +1.7%
- Subaru: +7%
- BMW: +14.8%
- Mercedes Benz: -9.2%
A recovery in new car sales has pushed down prices of used vehicles on the market as their owners upgrade, according to Schroders. Also, carmakers have reduced fleet sales to rental-car companies that are offered at discounts and are not as profitable.
Auto sales have fallen every month this year following seven straight years of record-setting volumes, suggesting that the market has peaked, at least for now.
The sales data came amid growing scrutiny of the booming auto-loan market, which has been compared to the subprime lending binge of the early 2000′s. Subprime auto loans for cars have increased, and the default rates on these loans are also increasing. But these loans, for borrowers with weaker credit profiles, represent only a quarter of total auto lending and 2% of the $13 trillion in US consumer credit, according to Schroders.
Economists forecast a rebound in July sales from June to a 16.8 million seasonally adjusted annual rate, according to Bloomberg.