The hurricanes are boosting car sales

Tomasz Zajda – stock.adobe.com

AFP

Tuesday, October 3, 2017 12:26

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Tuesday, October 3, 2017 12:26

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Sales of cars have had the wind in its sails in the United States in September, due to the replacement of hundreds of thousands of vehicles destroyed by powerful hurricanes Harvey and Irma, Texas (south) and Florida (south-east).

General Motors (GM) and Ford, the first two us car manufacturers, have taken advantage of this effect, which was interrupted by several months of sales difficult. GM has sold 279 397 vehicles last month, up 11,86% year on year. An increase of more than the +7.4% as anticipated by the firm Edmunds.com.

At Ford, which has to unveil on Tuesday a strategic plan, new registrations have reached 222 248, an increase of 8.7% year on year and almost double the forecasts (up 4.7%). “We are pleased to say that the recovery in Houston and in Florida advance quickly,” says Mark LaNeve, head of sales and marketing at
Ford.

Same story at GM: the chief economist Mustafa Mohatarem provides that “the regions devastated by the hurricanes of recent will continue their recovery, which should push up sales of new cars and opportunity”.

“Sales of new cars jumped to Houston, because the buyers want to quickly replace destroyed vehicles by Harvey,” says Jessica Caldwell, an expert in Edmunds.com. According to it, the application, for example, has jumped by 109% in Houston in the three weeks following the hurricane, compared to the three weeks leading up to the climate disaster.

“This demand will continue in October and probably November at the rate of compensation” of the victims, ” adds Tim Fleming at Kelley Blue Book.

Price increase

And the average price of transactions has increased by 18% in the region in September, which is a good sign for the profitability of automakers, initiated by the many promotions offered until August to try to boost sales in a slump since the beginning of the year.

The car is essential to Houston, the area where distances are great and public transportation is poorly developed.

According to the firm Black Book, it will be necessary to replace about 500 000 cars. Which is more than the 250,000 vehicles damaged by hurricane Sandy in 2012 or the 200 000 by Katrina in 2005, according to Cox Automotive.

Auto sales had declined 2.7% in the first eight months of the year. The observers agreed at the time to say that 2017 would mark the first year of decline after seven consecutive years of record.

Fiat Chrysler, the third automaker in the u.s., has also benefited from strong demand in the south of the country, which has allowed him to compensate somewhat for the fall in sales to rental-car companies (-41%). It has elapsed 174 266 cars in September, down certainly 10% but less than the decline of 11% anticipated by Edmunds.com.

The effect a hurricane has also been felt by the foreign manufacturers, to the image of the number two in the world
Toyota has elapsed 226 632 vehicles (+14.9 per cent year on year) and her fellow japanese Nissan (139 932 vehicles, +9.5 per cent).

The other manufacturers had to publish their figures in the course of the day, as the official statistics released by the law firm Autodata.

Approximately 1.43 million new cars expected to have been passed in the United States in September, a small increase of 0.4%, estimated by analysts. Annual rate seasonally adjusted (SAAR), total of 17.5 million cars should have been sold (-2,9% year on year).