US: discounts triggered by harsh winter go on through March image

The US automakers have had a rough start of year for sales, as the very harsh winter that affected many parts of the continental US made customers skip their trip to the local dealer. With that in mind, the dealers fought the weather with big discounts.

Because the extreme weather hit for the third month in a row many parts of the country, the Detroit automakers and some of its competitors had an unreasonably amount of vehicle inventory on the dealer lots.

“We believe short-term pent-up demand is building, but it’s difficult to know when it will be released,” said analyst Joseph Spak of RBC Capital Markets. “It could be March or spread out over a few months (and) is also likely dependent on the weather.”

Some of the biggest discounters seem to be GM and Ford, with the heaviest cuts made by Chevrolet and Ford on their full-size pickups – $8,000 and more on the 2014 Ford F-150 and $9,000 and more on the 2014 Chevrolet Silverado.

Analysts predict sales would slightly rebound in February after the bad January, with sales around the same level as last year’s February and the annualized rate at 15.4 million units.

Via Reuters