Dow Slips Nearly 2% After Adverse Weather Affects Business

The Dow Jones Industrial Average (DJINDICES: ^DJI  ) has slipped another 300 points, or 1.91%, by midafternoon after new numbers showed U.S. manufacturing activity slowed down last month. The Institute for Supply Management's manufacturing Purchasing Managers Index dropped to 51.3 in January from 56.5 in December. That hovers just above the 50 mark that divides expanding activity from contraction. Many analysts cited adverse weather in January as impacting the manufacturing and business figures. The weather certainly seems to be behind some rough numbers from the automotive industry.

Ford (NYSE: F  ) and General Motors (NYSE: GM  ) posted figures showing that respective January sales in the U.S. declined 7% and 12% from the same month last year. Sales of Ford's three most popular vehicles, the F-Series, Fusion, and Escape, declined 0.7%, 7%, and 2%, respectively.

"Given the difficult weather in our largest sales regions, we are fortunate to have held in at retail as well as we did," John Felice, Ford vice president, U.S. marketing, sales, and service, said in a press release. "In areas where the weather was good, such as in the West, sales were up. The poor weather also had an impact on the timing of some of our fleet deliveries."

Chrysler was the only Detroit automaker to post an increase in sales for January. Chrysler Group sold more than 127,000 vehicles in January, which was an 8% improvement from last year. That still checks in behind Ford and General Motors' sales totals of 153,494 and 171,486 in the U.S. market, respectively. Nissan led the industry for January, in terms of year-over-year comparisons, with a 12% gain to 90,470 vehicles sold last month. Toyota reported a 7% decline in January sales as well, with units down to 146,365.

On a positive note for the industry, analysts expect sales to catch up in coming months, weather permitting. Furthermore, TrueCar estimated that the average transaction price on vehicles in the U.S. rose 2.7% in January while incentives declined 3% -- making for a healthier first-quarter profit if the trend continues.

In other automotive news, Tesla Motors (NASDAQ: TSLA  ) proved it's beginning to overcome consumers' "range anxiety" by completing a 76-hour, cross-country trip in its popular Model S electric vehicle. It should be noted that currently you don't have too many options for a cross-country trip; however, compare the next two images to better understand how quickly one of Tesla's supercharger stations could be coming to an area near you by 2015.


Source: Tesla Motors

Tesla has 73 stations today, and by the end of this year 80% of the U.S. population and parts of Canada should have access to a supercharger station that can provide half of a full battery charge in as little as 20 minutes. Tesla plans to cover 98% of the U.S. population by the end of 2015, which will set the stage for a mass produced, and drastically more affordable, Tesla vehicle. 

Here Are 3 stocks long-term investors should hold forever
As every savvy investor knows, Warren Buffett didn't make billions by betting on half-baked stocks. He isolated his best few ideas, bet big, and rode them to riches, hardly ever selling. You deserve the same. That's why our CEO, legendary investor Tom Gardner, has permitted us to reveal The Motley Fool's 3 Stocks to Own Forever. These picks are free today! Just click here now to uncover the three companies we love. 


Read/Post Comments (1) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 05, 2014, at 8:36 PM, jlh939 wrote:

    I really wish more news outlets would report changes in the Dow in this manner - as a percentage, rather than in total points. Of course, that would make it clearer how much they sound like Chicken Little every time it drops a few hundred points.

Add your comment.

DocumentId: 2821289, ~/Articles/ArticleHandler.aspx, 4/19/2014 1:17:32 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement