Cars this year have been flying off dealers' lots like cartons of milk at grocery stores. Pent-up demand is driving growth in the industry, not to mention consumer sentiment is high with a growing economy, and U.S. automakers are reaping the benefits.
General Motors, Ford and Chrysler have all posted hefty second-quarter profits that exceed expectations on Wall Street. Trucks in particular are helping haul the overall sales throughout this year, but the question has to be asked: How did they do?
GM was able to manage a $1.2 billion net income in Q2 with a $2 billion operating profit in North America - not too shabby for the automaker that once got bailed out by Uncle Sam. While the European market is definitely taking a toll on GM - with sales are down to their lowest level in 20 years, according to The Detroit Free Press - strong demand in North American has helped boost profits.
"We continue to make good progress on the cost side of the business, continue with very aggressive cost control, managing our capacity, managing supply and demand," GM Chief Financial Officer Daniel Ammann told the news source. "Obviously what we don't control is the European macro environment. That remains very challenging."
Credit GM's success to the popularity of its trucks. The automaker is selling 2013 discount trucks, accounting for most of its overall sales, while it also released its redesigned 2014 Chevrolet Silverado and GMC Sierra pickup trucks, which are sure to be popular.
Watch out for the F-Series Silverado. Ford has relied heavily on its ever-popular F-Series trucks and my did the come through in the second quarter. Profits hit $1.2 billion, as Ford F-Series trucks have been the hottest selling vehicle in the automotive industry. Executives note however, that there has been strong growth across all segments, as the automaker now expects sale will be between 15.5 million to 16 million for the year, up from its previous expectation of 15 to 16 million.
"When we went through all the data in this particular quarter, it's all good," Ford Chief Financial Officer Bob Shanks told reporters. "We've got really strong momentum and we've got improvement across all parts of the business."
Ford too was not immune to the European sales woes . The automaker lost $348 million from the continent, up from last year's Q2 losses of $404 million. However, Ford did have its largest -ever profits in Asia, which helped offset these losses.
Again, it's all about trucks. F-150, meet the 1500.
Chrysler's $507 million profit was 16 percent more than last year's second quarter and was thoroughly helped along by the popularity of the Ram 1500. Combined with strong sales of the Jeep Grand Cherokee, the automaker was able to see net revenue hit $18 billion, up 7 percent from last year.
Chrysler recently reported its second-quarter earnings, and with the help of its popular Ram 1500, profits were strong.
"Chrysler Group is poised for a very strong performance in the second half of the year, with the new Jeep Grand Cherokee and Ram 1500 pickup earning best-in-class recognition, and the all-new Jeep Cherokee now rolling off the line," said Chrysler Group LLC Chairman and CEO Sergio Marchionne. "As we have highlighted previously, the timing of product launches and capacity increases causes this year's performance to be biased to the second half, and a continued aggressive drive for excellence and flawless execution will be essential to attain the targets we've set for ourselves."