DETROIT (Reuters) – Superstorm Sandy’s fury caused U.S. auto sales to fall short of expectations in October, but industry executives still see a strong fourth quarter as the housing market improves.
While General Motors Co (GM) and Chrysler Group LLC both reported their strongest sales for October since the 2007-09 financial crisis, the massive storm that hit the U.S. East Coast took as much as 30,000 vehicle sales out of the mix.
“Clearly, the storm had a bigger than anticipated impact on sales,” said TrueCar.com analyst Jesse Toprak. “It’s not the blockbuster month perhaps that we anticipated, but I would still say it’s a healthy rate.”
Ford Motor Co’s (NYS:F) U.S. sales last month edged up 0.4 percent, while sales for Toyota Motor Corp and Honda Motor Co rose about 16 percent and 9 percent, respectively. Nissan Motor Co Ltd’s sales fell 3.2 percent.
GM sales rose 4.7 percent, while those at Chrysler, an affiliate of Italy’s Fiat SpA (MIL:F), increased 10 percent.
Still, results from all the major automakers came in below expectations, indicating the U.S. industry will fail to reach the 14.9 million-vehicle annual sales rate economists had predicted for the month before Sandy pummeled the East Coast. Auto sales are an early indicator each month of U.S. consumer demand.
Auto executives and analysts said the industry will recoup much of the Sandy-related lost sales by the end of the year. But November sales will likely be impacted as well because the NY-NJ-Ct. tri-state area is the most populated metro area in the U.S. Many dealership will lose a week or two of business, and new sales to replace flood damaged cars won’t kick in until December and January.
Some automakers, including GM, Nissan and Toyota, are even offering deals to customers in regions hit by the storm.
Check out our gallery on Best Sedans of 2013 Model Year here.
Election uncertainty
The October sales report will be the last before election day, marking the end of a contentious U.S. presidential race that has repeatedly thrust GM and Chrysler into the spotlight in televised debates, stump speeches and campaign advertisements.
“As far as the election is concerned, they’ve made the economy a centerpoint of their mudslinging,” Kurt McNeil, GM’s vice president of U.S. sales operations, said on a conference call. “That just has caused some uncertainty in the consumers’ minds. Once we get past the election, all of these strong economic fundamentals are going to continue to play out.”
Citing an improving housing market that should help the industry record a strong fourth quarter, GM sees industry sales for this year at close to 14.5 million vehicles. Ford expects about 14.4 million. That would be the highest annual total since 16.1 million vehicles in 2007.
The massive storm, which hit New York City on Monday evening, hurt U.S. demand at the end of the month, with Ford officials estimating the lost sales for the entire industry at 20,000 to 25,000 vehicles. Toyota estimated the loss at 30,000 vehicles.
Toyota executives said that before Sandy hit, the industry had been heading for an annual selling rate in October of 14.7 million vehicles, but that the rate was now going to end at 14.3 million.
TrueCar’s Toprak said dealers often exceed 40 percent of total sales for any month in the last seven days. GM said its dealers from the Washington area through New England, including parts of Pennsylvania, had damaged cars and some were literally under water. In fact, half of GM’s dealers in New Jersey were still without power.
Many automakers still made gains in the month as rising home prices, attractive vehicle financing options and Americans’ growing need to replace their aging cars spurred more consumers to showrooms. That bodes well for the future, as GM’s McNeil said an improving housing market could be the “final piece of the puzzle” that lifts industry sales above 15 million annually.
The sales report also caps a busy week for the U.S. auto industry, which saw third-quarter profit reports from all three Detroit automakers.
GM shares were unchanged at $25.50 on Thursday afternoon, while Ford shares were up 6 cents at $11.22.
[Additional reporting by Reuters’ Paul Lienert and Deepa Seetharaman in Detroit, and AOL Autos.]
Featured Gallery
It may seem odd, but Halloween is becoming one of the most dangerous days on the roads. Accidents caused by drinking and driving around the holiday are up, and a new study by State Farm andSperling’s Best Places shows the day is deadliest for child pedestrians.
Drunk driving accidents are the biggest concern for families who may be driving their tots around after a fun evening of trick-or-treating. The National Highway Traffic Safety Administration says 40% of all car accident fatalities on Halloween are caused by drunk drivers.
So we here at AOL Autos thought it was time to take a look at the safest cars you can carry your family in — theminivan. The Insurance Institute for Highway Safety tested each of these cars for their performance in high-speed frontal and side crash tests, a rollover test and evaluations of seat and head restraints for neck injuries in rear impact crashes.
MSRP: $27,020 – $44,280
Invoice: $25,912 – $42,465
Fuel Economy: 17 mpg City, 25 mpg Highway
TheVW Routan has gotten the IIHS’s highest rating in every category in every test conducted on the car since 2009.
Besides being structurally sound, the minivan also comes with a number of features that help keep occupants safe. It comes with stability control and traction control, both which keep the car well-grounded and prevent it from tipping over. It has front, rear and third row head airbags, and a tire pressure monitoring system that helps drivers know when their tires might need air.
The VW Routan is essentially a re-badged, slightly tinkered Chrysler Town and Country. Given the popularity of those minivans, you’d think the Routan would be faring better in the marketplace. But the car just hasn’t caught on. VW doesn’t market it much either, so awareness of the VW is low.
Research the Volkswagen Routan
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MSRP: $26,435 – $41,325
Invoice: $24,453 – $38,020
Fuel Economy: 18 mpg City, 25 mpg Highway
Since 1998, theToyota Sienna has received top scores on all of the IIHS crash tests except once. For 2005 models that didn’t have optional side airbags, the minivan only got an “acceptable” rating, instead of a good rating.
But it’s still a very safe car. All of the trim levels come with side curtain airbags for all three rows, which ensures that, in the event of a rollover accident all occupants will stay inside the car. That’s a plus, because being thrown from a car during a violent crash is one of the leading causes of death (although people will sometimes anecdotally bring up cases where someone was thrown from a car and survived, it is generally something you don’t want to have happen.)
Higher trim levels offer more safety features, like a pre-collision protection system and rear-view cameras for backing up.
MSRP: $28,575 – $43,925
Invoice: $26,138 – $40,139
Fuel Economy: 18 mpg City, 27 mpg Highway
Honda was one of the first automakers to realize drivers with families were very interested in having safe cars. So they started putting as many safety features on their vehicles as standard equipment – meaning buyers wouldn’t have to pay more – as they possibly could. That move has resulted in a well-earned reputation for safety.
TheOdyssey is one of the IIHS top picks for minivans. Additionally, 2011 model year Odysseys and younger are the only minivans to get a 5-star overall rating from the National Highway Traffic Safety Administration.
Research the Honda Odyssey
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MSRP: $19,995 – $29,995
Invoice: $19,745 – $28,545
Fuel Economy: 17 mpg City, 25 mpg Highway
One of the most popular minivans around, theGrand Caravan is also one of the safest. Chrysler, Dodge’s parent company, invented the minivan back in 1984. The cars were easy to see out of, held a lot of stuff and passengers, and were easy for children to get in and out of.
The Grand Caravan, and its sister car the Chrysler Town& Country, have advanced safety features beyond visibility issues.
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MSRP: $29,995 – $39,995
Invoice: $28,735 – $37,935
Fuel Economy: 17 mpg City, 25 mpg Highway
The almost twin minivans from Dodge and Chrysler offer seven airbags and employ 8 different crush zones to keep occupants safe in the event of a crash.
The minivans also offer electronic stability control and other accident avoidant measures, because the best defense against fatal crashes is to never crash in the first place.
Research the Chrysler Town & Country
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