General Motors, Ford and Toyota reported U.S. sales declines in February as frigid temperatures and snowstorms pounded much of the nation.
According to an Associated Press report, the country’s top three automakers said the month started slowly but sales began to recover in the second half, a sign that fears of a broader auto sales slowdown may be unfounded. Chrysler and Nissan did report double-digit gains, but had to discount some key models to get there. Volkswagen, which has been struggling in the U.S., reported a 14% drop.
Industry analysts expect overall sales to rise about 1% for the month, a slow pace compared with the 8% increase for all of last year. Most blamed the weather, but some are wondering if the momentum of the past four years is waning.
Dealer inventories, especially for the Detroit automakers, have hit their highest level in five years, putting pressure on companies to clear their lots. At the end of January, dealers had an 89-day supply of cars and trucks, according to Ward’s AutoInfoBank. Detroit automakers had the most, with General Motors at 114 days, followed by Ford at 107 and Chrysler at 105. A 60-day supply of vehicles is considered ideal.
To unload the inventory, automakers are offering more discounts. That means deals for consumers. Incentives are the highest they’ve been in three years, averaging $2,633 per vehicle in February, up more than 5 percent from a year ago, according to the TrueCar.