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June 2, 2017 FacebookTwitterFlickrRSSSEND TO A FRIENDPRINT
Inside this issue
Sales Slip on Weak Car, Fleet Demand
Automakers Stuck With No-Win U.S. Market as Buyers Step Back
GM: Sales Fall; Chevy to End 'Bonus Tag' Promotion
Hyundai Faces Tough Times as Buyers Go Big
BMW, Mercedes Steer Through U.S. Slump With Made-in-America SUVs
German Carmakers Fear Losing Competitive Edge after U.S. Paris Exit
Certified Pre-Owned Cars Cost More, but Come with Perks
Different Words Matter to Different Car Shoppers
Top Stories
Sales Slip on Weak Car, Fleet Demand

Nissan, Ford, Honda up, GM, Toyota, FCA, Hyundai-Kia down

U.S. light-vehicle sales slipped 0.5 percent in May, even with higher discounts and strong truck demand, as the auto industry prepared to limp from one key selling season to another. The seasonally adjusted, annualized rate of sales fell to 16.7 million, down from 17.2 million in May 2016, on weaker fleet volume across the industry. Incentive spending continues to rise, averaging $3,583 per vehicle in early May, an increase of $241 from May 2016 and a record for the month, J.D. Power and Associates says.
Source: Automotive News

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Automakers Stuck With No-Win U.S. Market as Buyers Step Back

With the U.S. auto industry barreling toward its first annual decline since 2009, automakers are having to pick their poison: Slash revenue-generating production or close deals at steep discounts. Carmakers tempered the market’s slowdown in May with Memorial Day promotions and bulk shipments to rental fleets, allowing several to report better results than analysts estimated. Even still, the annualized rate of sales fell more than projected and the industry extended a streak of declining deliveries to five straight months.
Source: Bloomberg

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GM: Sales Fall; Chevy to End 'Bonus Tag' Promotion

Chevrolet is ending its long-running "bonus tag" promotion that was unpopular with many dealers and confusing to some customers. It's doing so after sales of the highly profitable Chevy Silverado fell for the fifth time in six months and with General Motors carrying the most inventory in nearly a decade. For June, Chevy is switching to a strategy of giving uniform discounts on certain trim levels, including 17 percent off all LT versions of the 2016 and 2017 Equinox, Traverse and light-duty Silverado, a spokesman said today. Customers can elect zero-percent financing or lease subvention instead. Chevy officials hope the new messaging will be simpler for dealers to communicate and for customers to understand than the tags, which were allocated each month to dealers, who then assigned them to individual vehicles.
Source: Automotive News

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Hyundai Faces Tough Times as Buyers Go Big

Andrew DiFeo can remember a time, just four years ago, when he could hardly keep enough cars on the lot at his Hyundai dealership in Florida. Gasoline was selling for $3.50 or more a gallon, Americans were looking for good fuel economy, and Hyundai seemed to have the answer. It is a far different story today. With gas prices lower, consumers have turned to roomier models like trucks and sport-utility vehicles. Cars and compacts are less in demand — and Hyundai’s fortunes have fallen sharply.
Source: The New York Times

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BMW, Mercedes Steer Through U.S. Slump With Made-in-America SUVs

Fewer new Mercedes-Benz models are making their way to Fifth Avenue to be bemoaned by Donald Trump -- and those that do are increasingly likely to have been built in the U.S. BMW AG and Mercedes parent Daimler AG’s U.S. sales in May dropped 11 percent and 8.2 percent, respectively, the German automakers said Thursday. South Carolina and Alabama-assembled sport utility vehicles were exceptions to a month of weak total deliveries, with demand jumping for BMW X3 and Mercedes GLE models.
Source: Bloomberg

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German Carmakers Fear Losing Competitive Edge after U.S. Paris Exit

Germany's powerful car industry said Europe would need to reassess its environmental standards to remain competitive after the United States said it would withdraw from the Paris climate pact. President Donald Trump said on Thursday he would withdraw the United States from the landmark 2015 global agreement to fight climate change, drawing anger and condemnation from world leaders and heads of industry.
Source: Reuters

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Certified Pre-Owned Cars Cost More, but Come with Perks

Certified pre-owned programs have been growing in popularity as the supply of used cars balloons in the U.S. New vehicle sales have risen for seven straight years and as many as a third of those vehicles were leased. That has left automakers with a steady stream of two- or three-year-old vehicles with limited mileage that are ideal for certified pre-owned programs.
Source: The Associated Press

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Different Words Matter to Different Car Shoppers

American car consumers are power hungry. Or at least the word “power” appeals to them when they’re vehicle shopping. That’s according to a new CDK Global analysis of what terms resonate with people as they read car reviews. Those are descriptors most likely to get a potential buyer off a review website and on a dealership’s, a big step toward an ultimate purchase. The study is the latest installment of CDK’s ongoing data-crunching assessment of what it calls “the language of closers.”
Source: WardsAuto

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Quotable
"We are seeing an artificially sustained market. It's undeniable that retail demand is down."

    -- Mark Wakefield, head of the automotive practice at AlixPartners, commenting on U.S. new-vehicle sales through five months of the year, Bloomberg, June 1

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