The U.S. auto industry’s momentum slowed in May, but remained at near-record highs as low gasoline prices continue to reshape the showroom floor.
U.S. auto sales declined 6% in May, compared with the same period a year earlier, in part due to two fewer selling days on the calendar, one of those being a Saturday.
The industry’s annualized selling rate — which gauges the overall pace of sales, putting the month in context — registered at 17.45 million units in May, according to Autodata Corp. That’s nearly equal to 2015’s full-year record of 17.5 million, but it was helped by a 7.1% increase in discounts.
“We’re just not seeing the growth, but bear in mind sales remain at lofty levels,” AutoTrader.com analyst Michelle Krebs said. “So the sky is not falling.”
Still, for the world’s three largest automakers — Toyota, Volkswagen Group and General Motors, in that order — it was a particularly rough month. Their sales fell 9.6%, 10.9% and 18% respectively.
Sales of cars, which just a few years ago represented one of the industry’s fiercest competitions, are tanking when compared to crossovers and SUVs.
Cars now represent 40% of the market, down from more than half a few years ago, said Mark LaNeve, U.S. sales chief for Ford Motor, whose overall sales fell 5.9% for the month.
LaNeve described all Ford cars except the Focus compact and Fusion mid-size sedan as “niche” products. Future offerings will be heavily concentrated in crossovers, sport-utility vehicles and pickup trucks, he said.
“That’s where consumers are going so that’s where we’re leaning in,” LaNeve said.
Low gasoline prices — which averaged $2.33 per gallon as of a few days ago, according to GasBuddy.com — and improved fuel economy for bigger vehicles have changed the game.
Toyota’s Prius, the hybrid that has long been a stalwart of the Japanese automaker’s lineup, saw its sales fall 36% for the month compared to a year ago.
Toyota is capitalizing off the transition, too. The company’s RAV4 and 4Runner utilities were up 12% to 32,261 units and up 21% to 10,352 units, respectively.