New U.S. vehicle sales were disappointing in April, prompting concern that the auto industry’s lengthy boom is coming to an end.
Autodata said sales of new cars and trucks fell 4.7 percent for the month to 1.43 million from the same month last year, the fourth consecutive monthly decline.
On a seasonally adjusted basis, the sales rate was 16.92 million. That figure was below forecasts of 17.1 million.
Sales at GM fell 5.9 percent, Ford sales dropped 7.1 percent and Fiat Chrysler sales were down 6.9 percent.
“Over the past six months we’ve watched nearly every automaker go from positive to negative sales volume, confirming the plateau in this latest sales cycle," Karl Brauer, executive publisher for Autotrader and Kelley Blue Book, told the Detroit Free Press.
The newspaper said sales fell for six of the eight top-selling automakers in the United States and that among Asian automakers, sales fell 7 percent for Honda, 4.4 percent for Toyota and 1.5 percent for Nissan. Sales at Hyundai rose 1.3 percent, but they fell 3.8 percent for sister company Kia.
Ford vice president of sales and marketing Mark LaNeve told the Detroit newspaper that the industry's sales pace was slower than expected throughout April, but he said it's too soon to conclude that sales will fall more than expected in 2017.
"We have to let the year play out," LaNeve said. "I am not discouraged by the numbers. I view it as within some kind of normal range in a plateauing industry."
“When you look at the broader economy, including a strong job market, rising wages, low inflation and low interest rates, and couple them to low fuel prices and strong consumer confidence, you have everything you need for auto sales to ... remain at or near historic highs,” GM chief economist Mustafa Mohatarem said.
Reuters said two consecutive weak months of sales has raised fears on Wall Street that the industry is on a downward trend after a long period of rising sales that began after the Great Recession ended in 2010.
Reuters said the industry faces challenges that include rising vehicle inventory levels, even though automakers have boosted discounts to gain customers. Used vehicles from the boom cycle are competing with new cars.
“The market is tapped out,” Adam Silverleib, vice president of Silko Honda, a dealership in Raynham, Mass., told the New York Times. “It’s no longer expanding at the rate the manufacturers thought it would.”
The Times said low gas prices, in part, drove automakers’ long period of sales gains by fueling demand for highly profitable SUVs and trucks. Consumers more recently have pulled back on big-ticket spending, which slowed economic growth in the first quarter.
The nation’s gross domestic product rose just 0.7 percent in the quarter, the slowest pace in three years, as consumer spending rose just 0.3 percent.
That was the smallest gain since 2009 and a dramatic decline from a 3.5 percent increase in the fourth quarter last year.