Auto Companies Crush July Expectations

A host of automotive companies released their U.S. sales figures for the month of July on Monday. Forecasts at the end of last month by JD Power and Kelley Blue Book both anticipated more than a 3 percent year-over-year increase and the highest sales total for the month in over a decade.

The big three American manufacturers -- Ford Motor Company F, General Motors Company GM, and Fiat Chrysler Automobiles NV FCAU all trounced analyst expectations and last year's numbers. GM and Chrysler each saw more than 6 percent gains over last July, while Ford posted a still-impressive 5 percent increase. Meanwhile, Honda Motor Co Ltd (ADR) HMC and Nissan each enjoyed 8 percent jumps for the month. Volkswagen sales moved up 2 percent and Toyota Motor Corp (ADR) TM stayed relatively flat.

Automakers likely benefited from low gasoline prices and a continuing surge in SUV popularity. All of Ford's major utility vehicles boasted double-digit sales hikes compared to July 2014. Meanwhile, the Nissan Rogue and GM's Buick Enclave each sold more than 50 percent better this year. The Jeep brand made up 41 percent of Fiat Chrysler's number of units sold. Large utility vehicles are marked by high margins.

Consumers are also apparently demonstrating their confidence by purchasing luxury vehicles. According to the Associated Press, luxury brand sales are growing at twice the rate of their mass-market competitors.

Lastly, many onlookers attributed strong sales to special deals offered by automakers aimed at enticing people to buy sedans, which have been losing popularity.

"The auto industry as a whole has started off the year on a much-needed positive note," Sean Bower, Chief Editor of the Wall Street Informer, told Benzinga. According to him, the consumer goods section of the market has been notably strong over the past several weeks. Nevertheless, he still sees the auto sector as relatively weak, finding itself at relatively the same position as it occupied two years ago according to ETFs despite growth in the overall market.

But Bower is confident that "rising stars," such as Toyota, which he gives 9 to 10 percent upside, will help propel auto equities upward.

Some firms will report sales later today.

Below is a summary of each firm's sales report.

• Ford -- Ford's U.S. sales were up 5 percent year-over-year for its best July since 2006. Retail sales were also up 5 percent. The company's commercial vans posted their best sales in 15 years. SUV sales were up 11 percent on July and the Lincoln brand boasted its best July in over a decade.
• General Motors -- GM's 6 percent beat on last year helped propel it to its best July in 8 years. Chevrolet had its strongest sales for the month since 2006 and combined with GMC to sell more than 86,000 pickup trucks. Meanwhile, the luxury Buick brand was up 18 percent year-over-year on strong crossover demand.
• Fiat Chrysler -- FCAU reported is 64th consecutive month of improved sales. Jeep sales gained 23 percent year-over-year and had their best July ever. The Chrysler 200, up 85 percent, also had its best July ever. In total, 8 vehicles in Chrysler's portfolio posted July sales records.
• Honda -- American Honda shattered its previous July trucks sales record with more than 70,000 units sold -- a 13 percent year-over-year increase. The Honda CR-V, Acura RDX, and Acura ILX all had July sales records.
• Nissan -- Nissan Group enjoyed an outright July sales record last month, with an 8 percent year-over-year increase totalling 131,000 total units. Sales of trucks, crossovers, and SUVs were especially strong, jumping 22 percent for the month. But Nissan's best selling vehicle was a sedan. The car had its all-time best July, selling 34,000 units.
• Volkswagen -- Volkswagen sales climbed by only 2.4 percent year-over-year. However, the new Golf family of vehicles sold 6,700 units, 175 percent more than last July. The Tiguan, Volkswagen's popular SUV, delivered a 13 percent sales increase. Otherwise, the numbers were relatively unremarkable.
• Toyota -- Toyota sales increased modestly by 0.6 percent in July. Camry was the best-selling model during the month. Meanwhile, the Tacoma and Tundra trucks were a rare bright spot, up almost 17 percent.