North American auto market
North America has always been one of the key battlegrounds for mainstream automakers. Automakers (FXD) including General Motors (GM), Ford (F), Fiat Chrysler (FCAU), and Toyota (TM) make most of their revenues from North America. Let’s take a closer look at their second quarter performance in North America.
General Motors’ revenues fell
North America is the largest single market for General Motors. In 2Q17, it accounted for ~77% of the company’s total revenues—higher than ~71% of its revenues in the previous quarter. Due to a YoY (year-over-year) decrease in its North American sales volume, General Motors’ revenues from the region fell 5.9%.
In the last few quarters, General Motors has been trying to cut its fleet sales to boost its profitability by focusing on more profitable retail sales. However, the strategy to cut fleet sales also hurt the company’s sales volume in 2Q and resulted in lower revenues.
Fiat Chrysler shipped ~576,000 vehicles to the North America market in 2Q17, which was ~14% fewer compared to 666,000 units shipped in 2Q16. Fiat Chrysler’s revenues from the NAFTA (North America Free Trade Agreement) region fell 8% to 16.0 billion euros or ~$18.8 billion.
Ford’s revenues were stronger
Unlike its peers, Ford reported a 3% YoY increase in its revenues to $24.5 billion from the North America region. However, Ford’s sales in the region fell ~1%. A favorable product mix and positive net pricing were the key reasons why the company posted higher North America revenues despite weakness in its sales in 2Q17.
In the next part, we’ll review how automakers performed in the European market in 2Q17.