General Motors Reports Weaker-Than-Expected July Sales as Auto Industry Stumbles

General Motors Reports Weaker-Than-Expected July Sales as Auto Industry Stumbles

Analysts expect auto sales to hit a new record high of 2 million units in 2017, according to analysts at Scotia Bank.

Several major automakers, including GM, Ford, Fiat Chrysler Automobiles, Nissan Motor Co. and Hyundai Motor Co. said they sharply reduced rental vehicle sales in July, and they portrayed the decisions as putting profit ahead of sales volume.

"Auto sales have peaked, they peaked nearly six months ago, and they probably don't drive the consumption that much anymore", Krishna Memani, chief investment officer at Oppenheimerfunds Inc., said on Bloomberg Television.

GM and other automakers are expected to report total U.S. vehicle and truck sales for July later this morning.

On Tuesday, carmakers in the US said they were continuing to slash their low-margin sales to rental fleets during July as the overall sales pace for USA autos and light trucks fell for the fifth consecutive month. The drop was lower than the 7 percent decline in June.

Shares of most major automakers have trailed benchmark USA stock indexes this year.

GM did not gain much ground trying to reduce the inventories of its unsold vehicles. New vehicle sales hit a record 17.55 million previous year. Fiat Chrysler ended production of many models it at one time sold to rental fleets. Average interest rates on new-vehicle loans fell to a six-month low of 4.77 percent in July as more brands offered no-interest financing, Edmunds said. Ford Motor Co. was down about 2.5%, while General Motors Co. fell by 3.5%.

"New home construction, and the real estate market in general, has been steadily improving and has even surpassed prerecession levels in some parts of the country", Tim Fleming, analyst for Kelley Blue Book, said in a statement.

But vehicle sales are plummeting, hurt by low gas prices and changing tastes.

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