Azernews.Az

By Bloomberg

Fiat Chrysler Automobiles NV said its U.S. sales in April rose 5.8 percent as its Ram pickups and Jeep SUVs won new buyers amid a consumer shift to larger, more rugged vehicles. The gains extended its sales streak to 61 months.

The company’s U.S. unit posted deliveries of 189,027 vehicles last month, missing the average analyst prediction of 7.6 percent, as automakers began reporting April results Friday. FCA US said Ram pickup sales rose 3 percent to 37,921. Jeep deliveries jumped 20 percent to 71,759, the brand’s best month ever, led by the Cherokee, Wrangler and Grand Cherokee.

“Our all-new Jeep Renegade small SUV is off to an exceptional start with more than 4,200 units sold in its first full month in the market, helping to propel our Jeep brand to its best monthly sales ever,” Reid Bigland, Fiat Chrysler’s head of U.S. Sales, said in the statement.

The industry’s April annualized selling rate, adjusted for seasonal trends, is projected to rise to 16.7 million, the average of 14 estimates, from 16.1 million a year ago. FCA forecast a 17 million rate, including medium and heavy trucks, which usually account for at least 200,000 yearly sales.

With U.S. gasoline prices down by about a third from a year ago, sales of large and luxury sport utility vehicles soared 31 percent in the first quarter, while family sedan sales fell 3 percent, according to researcher Autodata Corp. That trend continued last month, analysts said. It’s getting so hard to sell a small car, Ford Motor Co. is laying off 700 workers at a Michigan factory that makes compacts and hybrids.

Sales of cars and light trucks last month probably rose 5.9 percent to about 1.47 million vehicles, according to the average of 12 estimates. There were 26 selling days in April, the same as last year. The top six automakers are all projected to show gains compared with a year earlier.

Living Large

American consumers have become convinced lower fuel prices are here to stay and they are reverting to the vehicle equivalent of comfort food: roomy SUVs and pickups. Their focus on fuel economy has waned.

Chrysler brand sales jumped 26 percent, led by the 200 mid- size sedan, deliveries of which more than quadrupled to 18,850.

Energy recovery technologies weren’t attractive to car buyers surveyed recently by J.D. Power. Even President Barack Obama’s pleas to consumers to consider fuel-efficient cars have been falling on deaf ears.

“Lower gas prices are influencing people tremendously,” said John Wolkonowicz, a Boston-based independent auto analyst and historian. “Big is what we want. Americans don’t want those little cars.”

Speeding the move back to big is a new crop of SUVs that don’t guzzle like they used to and now ride on more comfortable car frames. These SUVs, known as crossovers because they combine attributes of cars and trucks, have become the perfect package to appeal to Americans’ desire to live large without feeling guilty.

‘Tailor-Made’ Crossovers

“The crossover is just tailor-made for what we are as a country and who we want to be,” said Wolkonowicz, a former product planner for Ford. “Most Americans want to see themselves as adventurous people, taking a go-anywhere, do- anything approach to life.”

While gasoline prices have increased 15 percent since the start of 2015, a gallon of regular gasoline still costs about a dollar less than it did a year ago, according to AAA, the motoring club.

Trucks are likely to be top sellers again for April. JPMorgan Chase & Co. predicts rising deliveries of profitable full-size pickups, while CLSA predicted that General Motors Co. would “benefit from the strong SUV environment.”

As Americans increasingly turn toward bigger vehicles, automakers are answering that demand.

Big SUVs

Sales of GM’s sleekly redesigned Suburban SUV were up 77 percent in the first three months of the year and the automaker is doing all it can to squeeze more out of the Texas plant that makes them. Ford’s Lincoln Navigator SUV, a hip-hop favorite way back in the 1990s, has found new life with modern styling that boosted sales 84 percent in the first quarter.

“These are not the same SUVs as 10 years ago,” said Michelle Krebs, senior analyst with AutoTrader.com. Crossovers, in particular, “get better fuel economy and because they’re on a car platform they feel different.”

Improved mileage and lower fuel prices have minimized buyers’ interest in the issue. Consumers ranked a list of energy-recovery systems not important in a new J.D. Power survey of technology preferences.

With no panic at the pump to drive consumer behavior, sales of small cars and hybrids have plunged. Small cars accounted for 18.5 percent of U.S. auto sales in the first quarter, down from 20 percent a year ago, Ford Chief Executive Officer Mark Fields told analysts last week.