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May 2016: FCA wins, Ford and GM stumble on weak car volumes

The May 2016 sales numbers are in, and it looks as though FCA is getting some vindication for boldly cancelling two slow-selling car models. Meanwhile, Ford saw overall sales dip and GM's May volume took a big dive versus the same month in 2015. While Marchionne's decision to axe the Chrysler 200 and Dodge Dart has drawn criticism as being short-sighted, it's working for FCA so far. Although the Dart and 200 aren't out of production yet and no capacity has been shifted to crossover or trucks, May's numbers show that the emphasis on Jeep and Ram models makes sense right now. FCA's US sales rose 1 percent last month compared to May 2015, putting the year-to-date total at 955,186 vehicles, an increase of 6 percent compared to the same period last year. Standouts included the Jeep Renegade, Compass, and Patriot, and the Fiat 500X. Ram pickup sales were down 3 percent. And your fun fact is that Alfa Romeo sales were up precisely 10 percent, for a total of 44 4Cs sold versus 40 in the same month last year. At FoMoCo, the Ford brand took a hit to the tune of 6.4 percent from May 2015 to 2016, registering 226,190 sales last month. Lincoln showed improvement on its modest numbers, going from 9,174 to 9,807, a 6.9 percent increase. Overall, Ford was down 5.9 percent for the month to 235,997; despite the slump, year-to-date total Ford sales are up 4.2 percent to 1,112,939. Strong sellers included Escape, Expedition, F-Series, and Transit - big stuff. Most small and/or efficient models (Fiesta, Focus, Fusion, C-Max) saw sales slides. Fusion sales were also down, likely due to effects of model changeover to the freshened 2017 model. Ford has promised four new crossovers and SUVs by 2020 and if things keep trending this way the company will be able to sell them, but things could change in the next four years. GM saw the worst of it for domestic brands. Retail and fleet sales were down for each of the four divisions, with the May 2016 total dropping 18 percent to 240,450 vehicles. GM's year-to-date sales are down 5.0 percent in 2016 to 1,183,705. Both the Sierra and Silverado were down significantly, and the majority of Chevy, Buick, GMC, and Cadillac nameplates saw sales decreases, with both small cars and larger utilities included. Not even big stuff could help GM this month, it seems. We'll have more on the rest of the industry's May sales as those figures trickle in.

Cadillac CT6 loses the entry-level 2.0-liter turbo four-cylinder

General Motors continues its engine rationalization among product lines. A few days after Chevrolet dropped the old-generation LTG 2.0-liter turbocharged four-cylinder from the Traverse, Cadillac has jettisoned the new-gen LSY 2.0-liter turbo four from the CT6 range. Given a look at the dealer ordering system, Cadillac Society said the 2.0-liter option shows "built out" or "no longer available," and the online configurator at the Cadillac site confirms the omission. The retired engine can be had in the XT4 crossover, rated at the same 237 horsepower and 258 pound-feet of torque. This means a couple of things for the big sedan. The CT6 entry price was $50,495 before destination, but fitted with the now-base 3.6-liter six-cylinder, the entry price has gone up to $55,495. The other change is that rear-wheel drive is no longer available; the three remaining engine choices come with all-wheel drive. Those engines are the NA 3.6-liter V6 with 335 hp and 284 lb-ft of torque, a 3.0-liter twin-turbo V6 with 404 hp and 400 lb-ft, and coming in a few months, the detuned 4.2-liter Blackwing twin-turbo V8 with 500 hp and 574 lb-ft, down from 550 hp and 627 lb-ft. Cadillac Society thinks one of the possibilities for making the move could be that GM is having a hard time meeting demand for the 2.0-liter. That might be, but we think no matter the reason, the result puts more logical pricing between the midsize CTS/CT5 and the full-size luxury flagship. We don't know how Cadillac will price the coming CT5, but there's now an $8,005 difference between the CTS and the CT6, instead of the $4,000 gap when the 2.0-liter was a CT6 option. Mercedes-Benz, for instance, puts a $12,000 gap between the C-Class and the E-Class, a $38,000 gulf between the E-Class and the S-Class. There's a $19,000 difference between an Audi A4 and A6, a $25,000 difference between an A6 and an A8. It isn't clear if this will affect every other market where the CT6 is sold. The Canadian, Mexican, and French Cadillac site configurators don't list the 2.0-liter turbo, but the Chinese Cadillac site does.

GM threatens predatory dealers with order cancellations, non-transferrable warranties

General Motors will launch a second salvo against misbehaving dealerships next week with a new set of policies aimed at curbing predatory markup strategies. With the new Chevrolet Corvette Z06, GMC Hummer EV SUV and Cadillac Escalade-V about to head into production, GM is putting its foot down yet again. Dealers that attempt to circumvent GM's markup restrictions by dealing directly with brokers or other resellers could find themselves in a particularly nasty spot, as the company is threatening to withhold future allocations and end the transferability of warranties when dealers facilitate the reselling of vehicles within 12 months.  While this may help curb some dealership chicanery, it's possible the real loser in such a deal could end up being the customer who unwittingly ends up with an un-warrantied vehicle. We suspect GM has accounted for that, but we'll have to wait until next week to find out exactly how these new policies will be enforced.