US Car Sales Have Fallen Five Straight Months

U.S. car sales are falling – a somewhat surprising trend in light of the record-setting sales the automotive industry posted in 2016. 

According to Autodata Corp, which tracks industry sales, the annualized pace of U.S. car and light truck sales in July fell to 16.73-million units, down from 17.8-million vehicles a year earlier. It’s the fifth straight month the overall pace of U.S. car and light truck sales have fallen.

Automakers are attributing the drop in volume to cutting low-margin sales to daily fleet rentals.  reports GM, Ford, FCA, Nissan, and Hyundai sharply reduced rental car sales last month, a decision made to put profit ahead of sales volume.

SEE ALSO: US Car Sales Had Another Record-Setting Year in 2016

For the most part, automakers have used low-margin sales to rental fleets so it could avoid factory shutdowns. But now there’s more flexible labor agreements, allowing the Detroit automakers to change production.

After a record-setting year last year, combined sales of large pickups fell four percent, and sales of large SUVs have dropped 20 percent. Only the Ford F-Series has seen an increase, up six percent compared to last year. Ford announced sales dropped 7.5 percent in July, while FCA experienced a 10-percent drop.

Japanese automakers aren’t doing much better, with Toyota the only company reporting a year-to-year gain with sales up four percent. Honda says its sales dropped one percent in July, while Nissan saw a three-percent drop.

[Source: Reuters]