FCA Sales: September 2018

[Rustydodge]

I'm afraid that the Lincoln name is holding that brand back. They've had some decent products, but they haven't had nearly the marketing efforts as Buick to change perceptions of the brand. Matthew McConaughey's Lincoln commercials were hilariously awful.

Ford seemed content for too long to lean on the F-series for the majority of their volume and I think that's biting them in the butt now that they're going to try to expand their SUV lineup after years of having mediocre products. Jeep proved it was possible to overcome mediocrity but they also had the off-road capability and lifestyle aspects to prop up their brand while Ford has no real defining characteristics of its own.

That and dispute significant updates to Lincoln navigator to separate itself from the new expedition, interior quality/fit/finish is apparently quite lacking from articles i've read. People will not accept that at the premium price point they are asking.

 

[Blown7]

I see lots of numbers and everybody is congratulating FCA on a great month, but I notice the only big ticket/profit is the pickups.

Jeep sold a lot..but not the top of the line Grand Cherokee with higher prices...... Lots of lower profit vehicles.

For me once gas prices go up I think FCA pick up sales will slack and profits will be much less.

I'm looking at the long game............. and for me (maybe I wrong) but I see not a lot of high margin sales.

 

[Ryan]

I see lots of numbers and everybody is congratulating FCA on a great month, but I notice the only big ticket/profit is the pickups.

Jeep sold a lot..but not the top of the line Grand Cherokee with higher prices...... Lots of lower profit vehicles.

For me once gas prices go up I think FCA pick up sales will slack and profits will be much less.

I'm looking at the long game............. and for me (maybe I wrong) but I see not a lot of high margin sales.

Pickup sales may go down if gas prices go up, but that’s not unique to FCA. Ford and Chevy will be in the same situation.

Not everything can be high-margin, otherwise FCA isn’t a mainstream company. The high sales of the cheaper models are funding development of more expensive models.

BTW, they outsold Ford and the Ram outsold the Silverado for Q3. Pretty significant achievements.

 

[TripleT]

Pickup sales have been consistent for decades, the product mix only is modified to the market. In good economic times the higher end models sell well.

 

[Ryan]

Sometimes good news can just be good news. Let's leave it at that.

 

[redriderbob]

Poor GM...

GM doesn't even do monthly sales reports anymore. Wonder why

 

[Blown7]

GM doesn't even do monthly sales reports anymore. Wonder why

Well Warren Buffett and a couple other Investors have said monthly sales skew the overall quarterly results and most companies only report quarterly.

So in order to please Wall St. (and make it easier on themselves) they went per quarter.....

Plus lots of big dealer networks out there like Autonation, Group 1, Van Tuyl, Penske, only report quarterly.

 

[redriderbob]

I see lots of numbers and everybody is congratulating FCA on a great month, but I notice the only big ticket/profit is the pickups.

Jeep sold a lot..but not the top of the line Grand Cherokee with higher prices...... Lots of lower profit vehicles.

For me once gas prices go up I think FCA pick up sales will slack and profits will be much less.

I'm looking at the long game............. and for me (maybe I wrong) but I see not a lot of high margin sales.

I see your point. But don't forget, FCA US has several "cash cow" vehicles selling pretty darn well too.

• Dodge Journey (sales up 2% for the year, thus far).
• Dodge Grand Caravan (sales up 12% for the year, thus far).

Ram sales for the year have stayed on par with what it had last year, so a 0% gain for the brand thus far this year. The Dodge brand is down in sales as a whole from this time in 2017, 2%. However, Challenger is on par with what it sold last year. Charger is down 12%. A lot of that may be because of fleet numbers since law enforcement fleets are buying up Explorer Police Interceptors like crazy, which FCA has just started making Durango Pursuit models.

Chrysler brand is down 12%, but remember that part of that was thanks to the Chrysler 200. Last year during the same time, the brand sold 17,267 Chrysler 200 models compared to only selling 1,000 left over units. The 300 is only 5,000 units down where it was at the same time last year and Pacifica sales are up 6% this year with 91,595 units sold already. That loss of the Chrysler 200 of an additional 16,595 units over the 1,000 sold this year, but the brand up to almost exactly where it was last year at this time with 143,000 units. So the Chrysler brand isn't as bad as what the numbers make it look like. The Chrysler 300 is down 12%, but the big sedan market is down almost 35% overall.

The Fiat brand in both U.S. and Canada is struggling. But they are over 40% down for the year. So with the updated Fiat 500 turbo models and the revamped 500X coming it may help but it won't make the brand sales jump. I did like the fact Fiat is taking a risk at battling the Ford EcoSport and Chevrolet Trax by offering standard AWD and turbo power on the 500X. It also keeps it out of the way of Renegade.

 

[redriderbob]

Well Warren Buffett and a couple other Investors have said monthly sales skew the overall quarterly results and most companies only report quarterly.

So in order to please Wall St. (and make it easier on themselves) they went per quarter.....

Plus lots of big dealer networks out there like Autonation, Group 1, Van Tuyl, Penske, only report quarterly.

Understandable... I was being sarcastic.

 

[Freshforged]

I see lots of numbers and everybody is congratulating FCA on a great month, but I notice the only big ticket/profit is the pickups.

Jeep sold a lot..but not the top of the line Grand Cherokee with higher prices...... Lots of lower profit vehicles.

For me once gas prices go up I think FCA pick up sales will slack and profits will be much less.

I'm looking at the long game............. and for me (maybe I wrong) but I see not a lot of high margin sales.

Understood, but Jeep also sold lots of Wranglers, and although you can get a base Wrangler--the median price of all the models is not cheap.
And Jeep gets a nice margine on the Compass--not as much as the outgoing model that was completely amortized, but sizable for a new model. It would be nice to know how many of the Cherokees sales were of the Pentastar, which would have a nice markup over the 4.

 

[TripleT]

Understood, but Jeep also sold lots of Wranglers, and although you can get a base Wrangler--the median price of all the models is not cheap.
And Jeep gets a nice margine on the Compass--not as much as the outgoing model that was completely amortized, but sizable for a new model. It would be nice to know how many of the Cherokees sales were of the Pentastar, which would have a nice markup over the 4.

Remember the Cherokee replaced the Patriot and Compass from a Cost center perspective not the Current Compass. Compass is coming from a lower cost structure. The Wrangler replace the Cherokee. The Ram replaced the 200. And the Dakota and JT will replace the Wrangler which mostly should be a wash. So one can see they every Cost Center move up the margin Chain. It is significant.

 

[Blown7]

Speaking of margin, What is the average margin for a vehicle ??
I always wondered, most car dealers always tell me they aren't making any money whenever I try to purchase a vehicle but yet, I work on some of the best aircraft a car dealer can buy.. Ernie Boch here in the Boston area has a 20 million Cessna Sovereign... ..and they say they don't make any money.....

 

[Freshforged]

Speaking of margin, What is the average margin for a vehicle ??
I always wondered, most car dealers always tell me they aren't making any money whenever I try to purchase a vehicle but yet, I work on some of the best aircraft a car dealer can buy.. Ernie Boch here in the Boston area has a 20 million Cessna Sovereign... ..and they say they don't make any money.....

Margin for dealers and manufactures are two different (but related ) things. I’m sure Ernies earnings are directly related to high volume and strict cost controls. Seems like owning a dealership really only pays when you go HUGE.

 

[Ryan]

Speaking of margin, What is the average margin for a vehicle ??
I always wondered, most car dealers always tell me they aren't making any money whenever I try to purchase a vehicle but yet, I work on some of the best aircraft a car dealer can buy.. Ernie Boch here in the Boston area has a 20 million Cessna Sovereign... ..and they say they don't make any money.....

Don’t have the info in front of me right now (I can check later today on a few vehicles) but difference in invoice price and MSRP for a Charger Scat Pack is around $2,000 depending on the packages selected. Actually a bit less than that IIRC.

 

[AlexB]

Understandable... I was being sarcastic.

It doesn't really work for retailers very well (quarterly sales vs monthly sales) ,because it has created "gossip" about sales performance which harm their stock prices.

 

[AlexB]

I see lots of numbers and everybody is congratulating FCA on a great month, but I notice the only big ticket/profit is the pickups.

Jeep sold a lot..but not the top of the line Grand Cherokee with higher prices...... Lots of lower profit vehicles.

For me once gas prices go up I think FCA pick up sales will slack and profits will be much less.

I'm looking at the long game............. and for me (maybe I wrong) but I see not a lot of high margin sales.

Remember Manley in the July have stated getting RAM production fully lunched is the factor for reaching 10% NAFTA/"Chrysler" EBIT Margins,and the way to tell RAM production was the monthly sales.
Since then August,September RAM sales been near 50,000 level.

 

[Blown7]

I was reading over at Jalopnik about a Detroit Free Press article about the price of pickups.. wow the average price is in the mid $40K range. You just gotta wonder how long it's gonna last.

https://www.freep.com/story/money/cars/2018/10/04/pickup-truck-prices-vehicles/1455588002/

 

[Bili]

I was reading over at Jalopnik about a Detroit Free Press article about the price of pickups.. wow the average price is in the mid $40K range. You just gotta wonder how long it's gonna last.

https://www.freep.com/story/money/cars/2018/10/04/pickup-truck-prices-vehicles/1455588002/

Until they reach low $50k.

 

[AlexB]

Until they reach low $50k.

Yelp, and Crew Cabs are the overwhelming majority of the Truck market in the U.S.
Crew cabs are in many ways "the new Large Sedan".

 

[Jared B]

Yelp, and Crew Cabs are the overwhelming majority of the Truck market in the U.S.
Crew cabs are in many ways "the new Large Sedan".

Very true. For people that liked the old body on frame full-sized sedan, well a crew cab pickup is now it.