US auto sales drop in May; GM hit hard

US auto sales fell in May, with the country's leading automaker General Motors taking a particularly hard hit as consumers curbed spending ahead of the summer driving season. Analysts had expected softer May sales generally after an April surge as a seven-year boom in the auto industry shows signs of moderating. Though job growth has been solid and wages are inching up, consumers have recently turned a bit less optimistic about the health of the US economy.
GM said it sold 240,450 vehicles last month, down 18 percent from a year ago. Industry researcher Edmunds.com had forecast 254,643 deliveries. GM said sales fell across brands, including Buick, down 22.1 percent, and Chevrolet, 18.6 percent. Ford reported sales fell 5.9 percent year-over year to 235,997 vehicles, missing Edmunds.com's estimate of 242,771 units. Ford brand sales fell but luxury brand Lincoln posted a 5.9 percent rise.
Over the first five months of the year, GM sales were down five percent from the same period in 2015, while US rival Ford sales rose 4.2 percent. On Wall Street, GM shares pared losses to trade at 3.0 percent in midday trade, while Ford shed 3.2 percent. Italian company Fiat Chrysler Automobiles reported its unit FCA US had a one percent rise in US sales in May, better than the market expected. Leading the gain was a 14 percent jump in Jeep brand vehicles; Chrysler brand sales fell 19 percent. FCA shares fell 2.4 percent.
Toyota, the world's largest automaker, said its US sales fell 9.6 percent but noted that the month of May this year has two fewer selling days than in 2015. Toyota brand sales dropped 9.5 percent and sales of the Japanese company's luxury brand Lexus were down 10.1 percent. Sales of Toyota's fuel-economy hybrid Prius plunged 36 percent from a year ago and were down about 25 percent since the beginning of 2016.
Volkswagen, the German automaker mired in scandal after admitting using emissions-cheating software in 11 million diesel vehicles worldwide, reported US vehicle sales fell 17.2 percent in May, bringing the total decline over the first five months of the year to 13 percent. Audi, one of VW's brands, separately reported a 1.6 percent rise in sales. Analysts expect that total US sales in May, fell 5.8 percent to an annual rate of 17.5 million vehicles.