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The next steps automakers could take after sales drop again in April

DETROIT (Reuters) - Major automakers on Tuesday posted declines in U.S. new vehicle sales for April in a sign the long boom cycle that lifted the American auto industry to record sales last year is losing steam, sending carmaker stocks down. The drop in sales versus April 2016 came on the heels of a disappointing March, which automakers had shrugged off as just a bad month. But two straight weak months has heightened Wall Street worries the cyclical industry is on a downward swing after a nearly uninterrupted boom since the Great Recession's end in 2010. Auto sales were a drag on U.S. first-quarter gross domestic product, with the economy growing at an annual rate of just 0.7 percent according to an advance estimate published by the Commerce Department last Friday. Excluding the auto sector the GDP growth rate would have been 1.2 percent. Industry consultant Autodata put the industry's seasonally adjusted annualized rate of sales at 16.88 million units for April, below the average of 17.2 million units predicted by analysts polled by Reuters. General Motors Co shares fell 2.9 percent while Ford Motor Co slid 4.3 percent and Fiat Chrysler Automobiles NV's U.S.-traded shares tumbled 4.2 percent. The U.S. auto industry faces multiple challenges. Sales are slipping and vehicle inventory levels have risen even as carmakers have hiked discounts to lure customers. A flood of used vehicles from the boom cycle are increasingly competing with new cars. The question for automakers: How much and for how long to curtail production this summer, which will result in worker layoffs? To bring down stocks of unsold vehicles, the Detroit automakers need to cut production, and offer more discounts without creating "an incentives war," said Mark Wakefield, head of the North American automotive practice for AlixPartners in Southfield, Michigan. "We see multiple weeks (of production) being taken out on the car side," he said, "and some softness on the truck side." Rival automakers will be watching each other to see if one is cutting prices to gain market share from another, he said, instead of just clearing inventory. INVESTORS DIGEST BAD NEWS Just last week GM reported a record first-quarter profit, but that had almost zero impact on the automaker's stock. The iconic carmaker, whose own interest was once conflated with that of America's, has slipped behind luxury carmaker Tesla Inc in terms of valuation.

2018 Lexus LS has a livelier look and new twin-turbo V6

When considering that the Lexus LC 500 made it to production virtually unchanged from concept form, it was reasonable to think that the LS would similarly follow suit. Especially when the LS shares the LC's GA-L platform. Unfortunately, it didn't pan out that way. It is possible to spot cues inspired by the LF-FC concept, such as the lower contour of the windows, the crease in the metal leading up to the rear wheel, and of course the lights and spindle grille. But they're overshadowed by the fact that this LS has a significant amount more girth. View 14 Photos Just because it doesn't live up to the concept doesn't mean it's a bad looking car. It's far more interesting to look at than the dated, upright LS currently on dealer lots. It also sits quite low and the wheels and tires fill the wells nicely, which gives it a road-hugging stance. There are some nifty design details, too, such as the glass that is completely flush with the pillars. View 28 Photos As already mentioned, the new body is wrapped around a stretched version of the LC's platform, and it also uses its 10-speed automatic. Surprisingly, though, the LS doesn't use the LC's powertrain. Under the hood is a completely new twin-turbocharged 3.5-liter V6 that pumps out 415 horsepower and 442 lb-ft of torque. That puts it down on power, but ahead in torque compared with the LC's V8. It's also significantly more than the previous LS' V8, and Lexus predicts it will be capable of a 0-60 mph time of 4.5 seconds with rear-wheel drive. A Lexus PR representative also said the LS is only being released with the V6. We doubt it would be hard to drop one in later though if Lexus saw demand. Inside, the LS is more interesting than the outside would suggest. The dash is clearly inspired by the LC 500, utilizing a similar gauge pod with traction control and drive mode selectors protruding from each side. The dash is also dominated by a wide, dark section that houses the 12.3-inch infotainment display. Just below that, is an attractive strip of slats that follow the contours of the dash and house the air vents. Back seat passengers also will have a pleasant environment thanks to the fact that the LS will only be available in a long wheelbase form, so leg room will never be in short supply. They also will have access to available reclining seats, ottoman, and Shiatsu massage functionality. According to a spokesman, the Japanese-style of massage function is a first for the LS.

Next Lexus RX looks ready to roll

Lexus' bread-and-butter crossover, the RX, has been long overdue for a substantial redesign, with the current third-gen crossover entering its sixth year on sale. Considering this, it's no surprise that the fourth-generation RX is well on its way to production readiness, as evidenced by our latest round of spy photos. This new model looks larger than the current RX, like the wheelbase has been stretched, which would likely explain reports that the company was looking at an optional third-row for the mid-sizer. Aesthetically, the Lexus spindle grille is easy to spot, as are its aggressive headlamps. It's unclear based on these images if the RX will adopt the same styling statement seen on the RC, IS and NX, with sharp LED running lamps mounted below the actual headlights, but it certainly seems likely. Besides the design changes, our spies report that Toyota will be working hard to shed weight, likely through the use of aluminum for the doors, hood and rear hatch. Underhood, expect the typical combo of a gas-powered six-cylinder as well as the V6/hybrid setup found in Lexus' 450h models. As for when we could expect to see the next-gen RX, your guess is as good as ours. Geneva is, as always, a candidate, as is April's New York Auto Show. Of course, should we confirm a debut at either show, we'll be sure to let you know. Stay tuned.