The Auto Slowdown Isn't a Problem for This Industry Supplier
The auto industry is facing material headwinds today, including weakening sales and rising costs. That's not a good backdrop for companies that supply large domestic carmakers like Ford (NYSE: F) and General Motors (NYSE: GM). Integrated steel giant Nucor (NYSE: NUE), however, isn't worried. In fact, it still expects to grow its auto business in the years ahead no matter what happens. Here's what's going on.
Domestic automobile sales have started to slow down in 2019 after a run of solid performance. New-vehicle sales fell 2.4% in the first half of the year, according to Automotive News. Some industry watchers expect the second half of the year will be even worse than the first half when the final numbers come in. That said, there are mixed signals coming from the big auto companies. For example, third-quarter U.S. auto sales for Ford were off by 4.9% year over year, while General Motors saw a pickup of 6% in the quarter but a roughly 2% year-to-date decline through the first nine months of the year. An interesting undercurrent is that both Ford and General Motors have benefited from strength in the truck space, highlighting a key trend: Auto companies are selling more expensive vehicles.
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Source Fool.com
