General Motors sees a massive drop in sales in 2019 owing to discontinued models and falling demand for trucks

on Jan 6, 2020
Updated: Mar 11, 2020
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  • General Motors sees a massive drop in sales in 2019.
  • GM cites discontinued vehicles, downbeat demand for trucks, and 40-day union auto workers' strike for poor sales.
  • None of the GM brands posted rising sales in the fourth quarter.
  • General Motors stock performance remained flat on average in 2019.

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General Motors saw a sharp decline in terms of sales in 2019 with a few of its vehicles discontinued while the demand for its full-size SUVs and pickup trucks remained suppressed.

On Friday, the Detroit-based automaker said that it sold approximately 2.9 million vehicles in 2019 that marked a 2.3% decline when compared to annual performance for 2018. The company further highlighted that 2019’s last quarter noted a 6.3% decline in sales as compared to the same quarter in 2018.

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While the company aligned itself with the analysts’ forecast for annual sales, the results fell shy of the 1% drop that was estimated for the industry at large.

GM Sold 12.7% More Crossovers In 2019 As Compared To 2018

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The sales of crossovers surpassed one million in 2019 (second consecutive year) that marked a massive 12.7% increase as compared to 2018. The higher than expected sales in crossovers segment, however, was largely offset by an even bigger, 30.5% drop in passenger cars in 2019 and another 2% drop in SUVs and pickup trucks. In the fourth quarter alone, crossovers’ sales hiked by 5.8% while a shocking 35.1% drop in passenger cars and a 5.9% drop in trucks were records.

As per the sales report, GM’s prominent brands like Cadillac and Buick failed to impress in 2019. Chevrolet, being the largest brand for the American multinational car manufacturer, also saw a drop of 3.8% in sales.

GM Cites Union Auto Workers’ 40-Day Strike For Declining Sales

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GM cited Union Auto Workers’ strike that lasted for 40 days to have contributed the most in declining sales. The representatives also hinted at the falling demand for the redesigned pickup models to have hurt the overall sales for the manufacturer. The 40 days strike, according to CFO Dhivya Suryadevara, cost an estimated 300,000 units in production to GM. Other factors that weighed on GM’s annual sales included discontinuation of passenger car models like Chevrolet Cruze, Chevrolet Volt, and Buick LaCrosse.

In the fourth quarter, none of GM’s brands posted an improvement in sales with GMC leading the drop with a 6.1% quarterly loss. Chevrolet recorded a 6.1% decline in Q4, Buick 4.3%, and Cadillac lying lower at a 2.2% drop in quarterly sales.

GM’s stock performance remained almost flat last year with the company trading only $2 higher than its opening level of around $34 in January 2019.

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