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Mixed sales results, but automaker stocks rise on need for cars in Houston

DETROIT — The Big Three Detroit automakers on Friday reported better-than-expected August sales and issued optimistic outlooks for demand as residents of the Houston area replace flood-damaged cars and trucks after Hurricane Harvey, sending their stocks higher. General Motors, Ford and Fiat Chrysler posted mixed August U.S. sales, with GM up 7.5 percent and Ford and Fiat Chrysler down. Japanese automaker Toyota improved sales by nearly 7 percent, while Honda fell 2.4 percent. Still, analysts focused on the potential for Detroit automakers to cut inventories and stabilize used vehicle prices as residents of Houston, the fourth largest city in the United States, are forced to replace tens of thousands, perhaps hundreds of thousands, of vehicles after the devastation from Hurricane Harvey. Mark LaNeve, Ford's U.S. sales chief, told analysts on Friday that following Hurricane Katrina in 2005 "we saw a very dramatic snapback" in demand. That said, Ford sales fell 2.1 percent in August. It sold 209,897 vehicles in the United States, compared with 214,482 a year earlier. Sales were down 1.9 percent in the Ford division and off 5.8 percent at Lincoln. Demand was down for cars, crossovers and SUVs. It was not clear how many vehicles in the Houston area will be scrapped, LaNeve said, saying he had seen estimates ranging from 200,000 to 400,000 to 1 million. Ford's Houston dealers may have lost fewer than 5,000 vehicles in inventory, he said. Ford is the No. 1 automaker in the Houston market, with 18 percent share, according to IHS Markit. The company plans to ship used vehicles to Houston dealers and has "every indication we would have to add some production" of new vehicles to meet demand, LaNeve said. Investor concerns about inventories of unsold vehicles and falling used car prices have weighed on Detroit automakers' shares most of this year. Now, automakers can anticipate a jolt of demand from a big market that is a stronghold for Detroit brand trucks and SUVs. "It's got to be a positive for the industry," LaNeve said. Investors appeared to agree. GM shares rose as much as 3.3 percent to their highest since early March. Ford increased 2.8 percent at $11.34, and Fiat Chrysler's U.S.-traded shares were up 5.2 percent $15.91, hitting their highest in more than five years. GM reported a 7.5 percent increase in U.S. auto sales in August, helped by robust sales of crossovers across its four brands.

2020 Buick Encore GX First Drive | Bringing serenity to the subcompact market

With Buick seeing sales success in our crossover-crazed world, it’s no wonder the company is adding to its crossover lineup with the 2020 Buick Encore GX. It sits just above the existing Encore, and it offers more space and new turbocharged engines for just a bit more money. In fact, as it starts at just $900 more than the existing Encore and offers more power, space and fuel economy, itÂ’s unquestionably the Encore version to get when heading to your Buick dealer. But compared with other crossovers, the BuickÂ’s only real advantage is in its quietness, refined powertrain and upmarket badge. Otherwise it's a fine but unexceptional crossover. Powering the Encore GX is your choice of small turbocharged three-cylinder engines. The standard engine, available with every trim, is a 1.2-liter unit making 137 horsepower and 162 pound-feet of torque. ItÂ’s only able to be paired with a CVT and front-wheel drive. ItÂ’s also not the most efficient powertrain offering, returning 28 mpg in town, 31 on the highway, and 29 combined. The optional engine, available only on the upper two trims Select and Essence, is a 1.3-liter example making 155 horsepower and 174 pound-feet of torque. This engine can be paired with a CVT and front-wheel drive, or a nine-speed automatic transmission with all-wheel-drive. Also, because of efficiency boosters such as an offset crankshaft, electric oil pump, electric brake booster and electric turbo wastegate, itÂ’s the most efficient choice. With the CVT and front-wheel drive, the Encore GX manages 30 mpg in the city, 32 on the highway, and 31 combined. The all-wheel-drive version only gets 26 mpg in town, 29 on the highway and 28 combined. Our test car was an Encore GX with the 1.3-liter engine and the CVT, and on paper, itÂ’s the engine to go with. ItÂ’s more power with less fuel use. And while itÂ’s not the most powerful car in its segment, its torque is accessible throughout the rev band, so it never feels slow. Buick has done an excellent job keeping the engine quiet, either through powertrain refinement or through extensive sound deadening. YouÂ’ll never hear more than a faint growl from under the hood. The CVT is absolutely the transmission to choose, too. ItÂ’s amazingly smooth and unobtrusive. The revs are always kept low and thereÂ’s just enough variance in them that it doesnÂ’t feel like a rubber band. It responds fast to your right foot, too, so you arenÂ’t waiting for more rpm when needing to accelerate faster.

PSA's purchase of Opel from GM is expected to be finalized soon

PSA's purchase of the Opel/Vauxhall division from General Motors is expected to be officially announced on Monday, according to The New York Times. PSA, the parent company of European automakers Peugeot and Citroen, will reportedly hold a joint press conference with GM in Paris to announce the deal. GM has worked as part of an alliance with PSA in Europe since 2012. The deal could be a big boon for both companies. For PSA, the addition of Opel and Vauxhall into its fold would catapult the automaker into second place behind Volkswagen for European marketshare, and would allow the company to spend research and development costs across a greater number of vehicles. And GM, which has struggled in recent years to turn a profit with its European division, would be able to focus more squarely on the areas where it's most profitable and to invest in future technologies like automation. But the deal isn't without its potential pitfalls, primarily for PSA. GM hasn't been able to make a success of Opel and Vauxhall, and it's not a sure bet that PSA will, either. What's more, the addition of Opel and Vauxhall doesn't expand PSA's reach any further into new markets, like China or India. The NYT cites data from Ferdinand Dudenhoffer, a professor at the University of Duisburg-Essen in Germany, showing that 70 percent of PSA and Opel business is done in Europe, a market that has been shrinking since 1999. We'll have to wait a few days to see exactly how the deal between PSA and GM will be structured. We're also curious to see how the loss of Opel may affect GM's lineup in the States, especially for Buick, since the company's Regal sedan is based on the European Opel Insignia. In other words, stay tuned. Related Video: