The U.S. auto market may be nearing the end of the go-go days for sport utility vehicles sold by the likes of Fiat Chrysler Automobiles NV’s Jeep.
Fiat Chrysler posted its first monthly sales decline in a year, with Jeep registering a rare back-to-back drop in deliveries. The company joined Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. in trailing analysts’ estimates for February in a Bloomberg News survey.
Jeep’s rough patch after a yearlong growth spurt adds to signs the American SUV boom may be reaching its limits. Rising interest rates rise and tighter credit are likely to make it more difficult to sustain the record prices fueled by consumers shifting allegiances to costlier pickups and other light trucks at the expense of sedans.
“Affordability is going to be a challenge for consumers going forward, and we’re beginning to see that,” Michelle Krebs, senior analyst for car-shopping researcher Autotrader, said by phone.
Blame Shutdown, Slow Refunds?
Sales dropped 5.9% for the lucrative Wrangler model, which entered February with inventory piling up at dealerships. Fiat Chrysler’s results wiped out a gain of as much as 1.7%, with the stock dropping 0.1 percent to $14.71 as of 11:34 a.m. Friday in New York.
“The overall industry is starting off slower due in part to weather, the U.S. government shutdown, and concern over tax refunds,” Reid Bigland, Fiat Chrysler’s head of U.S. sales, said in a statement.
Shares of General Motors Co. and Ford Motor Co., which have switched to reporting U.S. sales only on a quarterly basis, also dropped.
Toyota sales in February fell 5.2%, dragged down by weak demand for the RAV4 compact SUV. Deliveries fell 12.5 percent for the Japanese company’s top model in the U.S.
Deliveries of Nissan’s best-selling Rogue crossover plunged 16%, while Honda’s Pilot SUV posted an 8.8 percent drop.
“The results today suggest a much bigger story: The sales pace has finally shifted into a lower gear,” Charlie Chesbrough, senior economist of Cox Automotive.