Stronger truck and SUV sales
In September 2017, Ford Motor Company (F) sold about 103,625 units of trucks, a significant 19.9% increase YoY (year-over-year). Similarly, the sales of the company’s SUV (sports utility vehicles) segment saw an increase of ~1.8% to 68,705 units in September 2017 from 67,496 units in September 2016.
In September 2017, Ford reported its highest truck segment sales in 2017 so far.
Higher retail sales lead to optimism
Ford Motor’s September US sales to retail customers were at 164,067 vehicle units, a ~4.4% rise from the corresponding month of the previous year. In August, the company’s US retail sales fell 2.7% YoY to 164,067 units.
Could sales boost 3Q profitability?
As noted earlier in the previous part of this series, utility vehicles and trucks yield higher margins for auto giants as compared to those from small cars. Therefore, higher US truck and SUV segments sales in September were a positive factor for Ford 3Q17 profitability.
Similarly, a rise in September retail sales could also provide tailwinds to Ford’s 3Q17 profit margins as retail sales generate higher profit margins as compared to fleet sales.
Note that the US demand for heavyweight vehicles such as SUVs and trucks has gone up significantly in the last couple of years. This positive sales trend has benefitted all legacy automakers (IYK) including Ford, General Motors (GM), Toyota (TM), and Fiat Chrysler (FCAU).
Next, we’ll look at GM’s September 2017 US sales data.