January sales figures for the auto industry are rolling in today, and the numbers are not all that impressive. General Motors (GM) reported US January auto sales declined by 3.8% to 195,909 units. Fiat Chrysler (FCAU) said January sales were down 11% to 152,218 units. Ford (F) said US sales fell 0.6% to 172,612 vehicles. GM is down 1% on the day to $36.26, while Ford is flat at $12.39, and FCAU is down over 1.25% to $10.84
According to a press release from FCAU, Chrysler brand vehicles saw a near 39% y/y decline in January. Meanwhile, Dodge saw a 17% y/y decline. Jeep saw a 7% decline, while Ram sales grew 5%. In a press release, Ford reported its line of cars, saw a y/y decline of 1.6%, while its Lincoln line saw an increase of 22.4%. GM didn't break out sales by segment; however, the release noted the new Chevy Bolt was available in California and Oregon. It's worth tracking sales of the Bolt over the next several months as other manufacturers begin to roll out their initial electric vehicles.
The year is not starting off on the right foot for the autos, and it wasn't much better in 2016 for that matter. Shares of FCAU were flat for 2016, while shares of GM were up about 2%, while shares of Ford fell about 13%. Fiat saw its shares rise shares jump to start 2017, rising nearly 25% to January 12th, when news broke the EPA was investigating Fiat for emissions cheating software. (See also: EPA: Fiat Chrysler Cheated Tests With Software.)
For auto investors, near-term performance for these stocks will be all about tax reform and deregulation, which President Trump said was a big priority during his meeting with industry CEOs in mid January. In exchange, the president wants to see more manufacturing and production come back to the US. Deregulation and tax reform will help improve bottom lines, but these companies still have to sell more cars to boost revenue. For attentive investors, organic revenue growth is the key. (See also: Auto CEOs Meet with President Trump.)