GM, Stellantis sales plunge in 3rd quarter as chip woes cut inventory
Detroit — The global semiconductor shortage is continuing to cost vehicle production and eat into valuable new-vehicle inventory, leading General Motors Co. to post a 33% year-over-year drop in third-quarter sales and Stellantis NV, maker of Ram trucks and Jeeps, a 19% decline on Friday.
GM's dealers sold 446,997 vehicles in the U.S. in the quarter, down from the 665,192 sold last year as a result of historically low inventories. Stellantis dealers sold 410,917 vehicles, down from the 507,351 sold in the third quarter of 2020.
The industry has been battling the chip shortage since the start of the year. The shortage is expected to cost $210 billion in lost revenues this year and cause lost production of 7.7 million vehicles, according to consulting firm AlixPartners LLP.
Automakers hinted sales would take a hit in the third quarter because of the chip shortage causing them to halt production at various plants and leaving dealers with little new-vehicle inventory to sell.
GM said its North American wholesale volumes, or dealer deliveries, in the second half of 2021 would be down about 200,000 units from the first half because of disruptions to semiconductor production in Malaysia caused by COVID-19. Despite the chip struggle, GM isn't changing its projected guidance of $11.5 billion to $13.5 billion in adjusted earnings for the year.
“GM has been agile and decisive in managing COVID-related impacts on our production and wholesale volumes and we appreciate the support of our dealers and the loyalty of our customers,” Steve Carlisle, GM North America executive vice president and president, said in a statement. “The semiconductor supply disruptions that impacted our third-quarter wholesale and customer deliveries are improving. As we look to the fourth quarter, a steady flow of vehicles held at plants will continue to be released to dealers, we are restarting production at key crossover and car plants, and we look forward to a more stable operating environment through the fall.”
All of GM's four brands saw a sales decline in the quarter: Buick dropped by 20%, Cadillac by 32%, Chevrolet by 36% and GMC by 27%.
Overall, GM's sales for the year are 1,777,483, only slightly above last year's sales at this time. Chevrolet is down 6% year-to-date.
All of Stellantis' brands also saw a drop in the quarter. The popular Jeep brand fell 11% and Ram slid 17%.
For the year, total Stellantis sales are up 3% at 1,365,880.
“While the various supply chain issues facing our industry continue to impact available inventory, we know the demand for our vehicles is still there,” Stellantis U.S. Head of Sales Jeff Kommor said in a statement.
Toyota Motor North America saw a 1% increase in third-quarter sales and Hyundai Motor America posted a 4% increase in sales.
Honda Motor Co. posted an 11% sales decline during the quarter.
"The enduring nature of the microchip shortage and port congestion issues continue to constrain the entire industry, but we are encouraged by the record sales of Honda models where we have adequate inventory,” said Dave Gardner, executive vice president of national operations at Honda.
Ford Motor Co. reports sales Monday.