Auto stocks in January
So far this year, all mainstream auto companies have been trading positively and have outperformed the broader market (SPY) by a large margin. As of January 13, 2017, General Motors (GM), Ford Motor (F), and Fiat Chrysler Automobiles (FCAU) had gained about 7.2%, 4.1%, and 6.7%, respectively, since the beginning of the month. These gains are much higher than the 1.6% gain seen by the S&P 500 this month. Before analyzing recent economic data, let’s take a look at US auto industry sales figures.
GM is the largest US automaker by volume, followed by Ford. While GM reported an increase of 10% YoY (year-over-year) in its December sales, Ford’s remained flat, with a YoY increase of 0.3%. In contrast, Fiat Chrysler’s US sales fell 10% YoY, and its European sales remained firm.
The US auto industry has witnessed high demand for heavyweight vehicles in the past couple of years. According to data compiled by Autodata, US auto sales were at their highest in 2016, with about 17.6 million vehicles sold during the year. This data certainly boosted automakers’ confidence. However, the debate about US auto sales being at peak levels remains open. As of January 12, 2017, Tesla Motors (TSLA), the popular electric carmaker, had gained about 11.3% since the beginning of the month.
Read All You Need to Know about US Auto Sales in 2016 to learn more about mainstream automakers’ fiscal 2016 US sales data. In this series, we’ll take a look at the key economic indicators auto investors can track to get an idea of future trends. We’ll also look at consumer confidence and employment data. Later in this series, we’ll explore some macro factors that may affect automakers’ profitability.