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Why Fiat Chrysler’s US Sales Fell for 16th Month in a Row

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Jan. 16 2018, Updated 9:00 a.m. ET

FCAU’s US sales in December 2017

In December 2017, Fiat Chrysler Automobiles’ (FCAU) total US sales dropped to 171,946 vehicles, which was about 11% lower from the company’s US sales of 192,519 vehicle units in 2016 but about 11% higher than the 154,919 units sold in November 2017. This was the 16th consecutive month that FCAU’s sales fell in the US market.

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Recovery in US retail sales

Last month, Fiat Chrysler’s retail sales were down at 150,772 vehicle units, a drop of about 3% YoY (year-over-year). Earlier in November 2017, the company’s US retail sales rose by 2% YoY to 129,539 units. As a percentage of its overall US sales, Fiat Chrysler’s December retail sales were at 88%.

Cutting fleet sales

In December 2017, Fiat Chrysler’s US fleet vehicle sales continued to decline by about 42% to just 21,174 vehicle units. These were also lower than its November fleet sales of 25,380 units.

As a part of its strategy to improve profit margins, Fiat Chrysler reduced its US sales to the daily rental segment in 2017 just like General Motors (GM). This is because daily rental segment sales typically result in lower profits for auto manufacturers (XLY) as compared to profits from retail sales. Due to this planned cut in fleet sales, FCAU has been losing its US market share to peers like GM, Ford (F), and Toyota (TM) lately. Ford and TM both have reported positive US sales growth in most of 2H17.

This massive drop of about 42% in its fleet sales along with a 3% decline in retail sales translated into about an 11% fall in FCAU’s total US sales last month.

Continue to the next part to learn how Fiat Chrysler’s car and truck segment sales were in December 2017.

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