Automotive MMI: June Sales a Mixed Bag for Automakers

The Automotive Monthly Metals Index (MMI) picked up one point this month, rising for a reading of 87.
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U.S. Auto Sales

General Motors reported Q2 deliveries of 746,659 vehicles, marking a 1.5% decline on a year-over-year basis.
GM’s chief economist said U.S. light-vehicle SAAR for the first half of the year is expected to reach 17.0 million units.
“The U.S. economy continues to grow at a healthy pace. Jobs are plentiful and inflation remains low,” said Elaine Buckberg, GM’s chief economist. “Auto demand was better than anticipated in the first half and we expect strong performance in the second half of the year. If the Fed cuts rates, as widely expected, lower financing costs will provide further support to auto sales.”
Meanwhile, Ford Motor Co. is scheduled to announce its Q2 sales results at 9:15 a.m. ET on Wednesday, July 3.
Fiat Chrysler reported it had its best June in 14 years, posting total sales growth of 2%, tallying 206,083 vehicle sales. Ram pickup truck sales surged 56% in June to 68,098 vehicles and 179,454 vehicles in the quarter.
Total Honda sales fell 7.3% in June, while Nissan sales fell 14.9%. Hyundai sales were up 2% in June and rose 2% in the first half of the year. Subaru reported 61,511 vehicle sales in June, marking a 2.8% year-over-year increase.
Toyota sales fell 3.5% on a volume basis and increased 0.3% on a daily selling rate basis.
According to a monthly forecast released jointly J.D. Power and LMC Automotive, June retail sales were expected to fall 2.9% compared with June 2018, while total sales were forecast to drop 1.5% year over year.
Despite slumping sales this year, automakers have cashed in on higher average transaction prices. According to J.D. Power and LMC Automotive, new-vehicle prices are up 4% in the first half of the year compared with the first half of 2018.

“While the first half of 2019 is expected to deliver its weakest retail sales since 2013, the growth in prices has been nothing short of remarkable,” said Thomas King, senior vice president of J.D. Power’s data and analytics division. “Average transaction prices set a record during the first half, which has big implications for manufacturer revenues.”

GM Announces Michigan, Texas Investments

Last month, GM announced plans to invest $150 million in its Flint Assembly plant and $20 million at its Arlington Assembly plant.
At the Flint plant, the automaker aims to augment production of its Chevrolet Silverado and GMC Sierra models.
Meanwhile, the $20 million investment in the Texas plant aims to upgrade the plant’s conveyors in preparation for the rollout of the automaker’s new full-size SUVs. According to a GM release, the upgrades are expected to be completed next year.

Actual Metal Prices and Trends

The U.S. HDG price fell 6.9% month over month to $779/st as of July 1. The U.S. platinum bar price increased 1.7% to $834/ounce, while palladium surged 15.8% to $1,516/ounce.
U.S. shredded scrap steel fell 7.1% to $274/st. LME copper jumped 2.8% to $5,981.50/mt.
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Chinese primary lead ticked up 0.9% to $2,340.98/mt.