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Great News for Detroit Automakers: April's Sales Results Bring More of the Same

By Daniel Miller - May 5, 2016 at 11:06AM

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Detroit automakers continue to thrive as consumers trade in their cars for bigger, more expensive SUVs and trucks.

April's new-vehicle sales in the U.S. increased 3.5%, pushing the Seasonally Adjusted Annual Rate to 17.42 million, and it appears to be driven by the same trend for SUVs and trucks -- and for Detroit automakers, that's a great thing. The 17.42 SAAR result was much stronger than March's 16.56 million mark, as well as last year's April level of 16.77 million.

"Consumer preference for SUVs and pickup trucks continued unabated in April," said Reid Bigland, FCA's senior vice president for North America sales, in a press release.

With all of that said, let's zoom in on Detroit automaker highlights from last month.

GM retakes the lead
After Ford Motor Company (F -2.72%) managed to outsell General Motors (GM -1.99%) by a slim margin during March, the latter has reclaimed its No. 1 selling position despite posting a year-over-year decline. GM's total sales declined 4% to just under 260,000 units in April. However, that's been a trend for Detroit's largest automaker of late, because it continues to focus on retail sales rather than fleet sales.

In fact, GM's deliveries to retail customers were up 3% to 200,656 units last month, driven by a 13% rise at Buick, 5% at GMC, and 4% at Chevrolet. If you're keeping track, that makes the 12th consecutive month where GM's retail deliveries moved higher.

GM's Chevrolet brand continues to impress, with its retail sales moving 9% higher through the first four months of 2016, making it the fastest-growing full-line franchise in the U.S. industry. Helping drive that result was the all-new Malibu, which has grown its retail deliveries up 53% year to date; J.D. Power notes that the Malibu has nearly doubled its retail market share from 5% during 2015 to 10% thus far into 2016.

Of course, you can't discuss a monthly sales result from Detroit automakers without checking sales of the bread-and-butter full-size trucks! GM's Chevy Silverado posted a sales gain of 8.7% during April, and its Sierra sister truck managed to gain 13.5% compared to the prior year. That marks the Silverado's best April since 2006 and the Sierra's best April ever.

Sales of those trucks, plus GM's SUVs, helped drive its average transaction prices (prices after sales incentives) to $35,400 in April. That's more than $4,200 above the industry average, and the automaker's incentive spending as a percentage of ATPs was 10.3% last month, below much of the industry.

Next up
Ford checked in with sales slightly lower than GM's results, with units sold reaching 231,316 for a 4% gain over last year's April. Looking at retail sales, Ford sold 3% more than last year's April, which was its best April retail result since 2006.

Similar to GM, Ford's results were driven by SUVs and trucks. The automaker's SUV sales totaled 65,474 in April, which was the best April result in company history.

"We saw strong consumer demand in April, especially for pickups," said Mark LaNeve, Ford vice president, U.S. Marketing, Sales and Service, in a press release. "F-Series has moved past the quarter million sales mark year to date -- the strongest start for F-Series in a decade, while Ford brand SUVs are having their best year ever."

While this data isn't an apples-to-apples comparison to GM's figures, Ford's average transaction pricing for the full lineup checked in at $1,500 compared to the prior year's April, and it was $700 higher compared to the industry's average increase.

Also, Ford's luxury Lincoln brand is quietly having a great year. Lincoln sales jumped 20% in April to 9,776 units sold, with the MKX posting a huge 94% sales gain for the month. In fact, Lincoln's utilities segment posted a 52.8% gain compared to the prior year's April, and its year-to-date gain remains a healthy 33.8%. As a surprise, at least to me, was the MKX becoming Lincoln's best-selling vehicle thus far into 2016 -- outpacing the flagship MKZ sedan and the newest addition MKC SUV.

Last but not least
Fiat Chrysler Automobiles (FCAU) reported that its April sales increased 6% for the company's best April sales result since 2005. Its total sales figure checked in just under 200,000 units, and the automaker benefited exactly the same way its crosstown rivals did, from rising SUV and truck sales. Jeep brand sales rose 17% for its best April sales result ever, and the Renegade and Compass each posted record monthly sales results. April marked the 31st consecutive month of year-over-year sales gains for Jeep, which is a pretty absurd record.

Not to be completely outclassed by SUV sales results, the Ram Truck brand posted a 12% gain in April, which was also its best result since April of 2005. In addition to the brand's rising sales, it picked up a few awards along the way last month.

"The 2016 Ram Rebel was named winner in the Pickups category at NWAPA's "Mudfest" competition in April. In addition, Popular Mechanics magazine last month recognized the 2016 Ram Truck brand product line with its Automotive Excellence Award. Compared to all other full-size pickups, the Ram 1500, 2500 and 3500 offerings had the best combination of technology, performance, and value, according to FCA's press release.

After a strong first-quarter earnings season from Detroit automakers, investors should anticipate more strong sales and earnings results on the back of rising SUV and truck sales, along with higher average transaction prices -- more of the same is great news for these three automakers.

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