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Chrysler News: Chrysler 200 Was A Worse Seller Than First Expected

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As Fiat Chrysler Automobiles continues its cooperation with the federal investigation into its falsified sales, they have begun to issue restate monthly sales results. They reveal that the Chrysler 200, a midsize sedan the company was hoping to be a success was even less popular than we first though.

Automotive News reports that in a three-month period from July to September 2015, FCA reported that it sold 21 percent more 200s (8,577) than the new numbers. To put this in perspective, the second-largest discrepancy in sales was the Dodge Charger with 2,258 over-reported sales. 

"There was a lot of pressure on the 200 to offset the loss of sales from discontinuing the Dodge Avenger," said Dave Sullivan, an analyst with AutoPacific.

"FCA was under pressure to deliver a midsize car that could compete with the Accord and Camry after they emerged from bankruptcy. They were vilified for not offering competitive cars after we saw gas spike to $4. The 200 was meant to show how FCA was committed to offering passenger cars that could compete."

There was also a $1 billion investment FCA made into the Sterling Heights Assembly Plant to build the 200. There was a lot of pressure for this sedan to succeed and could explain some of the reason as to the inflated sale numbers.

Source: Automotive News (Subscription Required)
Pic Credit: William Maley for Cheers & Gears


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I would still argue getting out of the passenger car business is probably a good business model for them.  They have not been passionate about mainstream cars since the 1990's IMHO.

Specialty vehicles like the Charger and Challenger are another matter.

The real question is what do they do when the next round of fuel economy fleet standards hit, or when gas goes back up to $4 a gallon.

Do not myself see them getting back into the traditional passenger car business again soon.

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That's what happens when you make bottom of the barrel products. They should probably stick to building literally anything else besides mainstream sedans.

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11 minutes ago, Frisky Dingo said:

That's what happens when you make bottom of the barrel products. They should probably stick to building literally anything else besides mainstream sedans.

Given the competitive nature of the sedan market, yes. As a car maker, you have to come to grips with who you are.

There is a reason that Mazda does not build Luxury cars, Porsche does not build economy cars, and Toyota does not build high end performance cars.

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I KNEW IT! I knew there was something off about their stretch of incredible sales when the 200 suddenly plummeted in the segment. Either they were absolutely selling their soul to rental agencies or the numbers were off. 20% sales inflation is pretty reprehensible.

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They shouldn't have even attempted this in the first place. For two reasons-

1)This segment is so deep with competent offerings, that unless you are building something that near-flawless objectively, there's no point. Even a car that is slightly behind the pack is going to get left in the dust from a sales standpoint.

2)It's a declining segment anyway. Building the best of something that is going to become obsolete isn't the greatest business case. It'd be like trying to make the best VCR after DVD players had already gained a foothold in the market.

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10 minutes ago, cp-the-nerd said:

I KNEW IT! I knew there was something off about their stretch of incredible sales when the 200 suddenly plummeted in the segment. Either they were absolutely selling their soul to rental agencies or the numbers were off. 20% sales inflation is pretty reprehensible.

Damn straight.

Offering money to dealers to fudge month end sale numbers is some shady business practice. Very unethical. Those are some big skeletons in FCA's closet. 

2 minutes ago, Frisky Dingo said:

They shouldn't have even attempted this in the first place. For two reasons-

1)This segment is so deep with competent offerings, that unless you are building something that near-flawless objectively, there's no point. Even a car that is slightly behind the pack is going to get left in the dust from a sales standpoint.

2)It's a declining segment anyway. Building the best of something that is going to become obsolete isn't the greatest business case. It'd be like trying to make the best VCR after DVD players had already gained a foothold in the market.

Your last sentence sums up the execution of the 200 ( and Dart ) perfectly. 

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Agreed @Frisky Dingo. They entered the market of the two deepest rosters with the heaviest of heavy hitters in the Camry, Accord, and Malibu and just didn't execute it well. It would have ad to have been absolutely perfect but like you said the segment is shrinking anyway.

I'm sure all of the other mid size sedan companies are glad to see somebody leave the segment to get a few sales back. The segment was just too damn deep. They need somebody else to leave the segment as well but I don't see that happening right away.

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@ccap41

This segment is definitely going to start drying up. Only the fittest are going to survive. The current players are going to have to start really doing something compelling to keep sales numbers up. As it stands, even 4 grand price differences, and 5-7mpg better EPA ratings aren't doing the trick. I think the answer may be to start making them more stylish and fun to drive, ironically. The Fusion Sport, harsh of a review as I gave it, may be a big step in the right direction. 

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15 minutes ago, ccap41 said:

Agreed @Frisky Dingo. They entered the market of the two deepest rosters with the heaviest of heavy hitters in the Camry, Accord, and Malibu and just didn't execute it well. It would have ad to have been absolutely perfect but like you said the segment is shrinking anyway.

I'm sure all of the other mid size sedan companies are glad to see somebody leave the segment to get a few sales back. The segment was just too damn deep. They need somebody else to leave the segment as well but I don't see that happening right away.

Maybe VW will leave the segment. ;) They can afford too.

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9 minutes ago, dfelt said:

Maybe VW will leave the segment. ;) They can afford too.

Highly doubtful.  They are one of the worlds largest and most profitable car companies and they desperately want the US market for economies of scale.

Letting Toyota, GM or the like dominate the US market would mean that they would loose that advantage and thus put their prime markets such as South America, Africa, China and the like into Jeopardy.

Plus they are already federalizing their drive trains and building their platforms to US safety and emissions standards for Audi, Porsche, and the like. So they have no real cost advantage for doing this.

If anything, they need a small crossover. the Honda HRV actually outsold the Camry last month, and building a desirable version of something like that is very much in VW's DNA.  It's actually far more plausible for VW to build and sell something like that than the Atlas concept we were shown.

Given that a lot of the VW market share is urban....and young and professional....

But the smartest people do the dumbest things and people in Stuttgart and Wolfsburg will wonder with angst and hand wringing why the Golf is down when they are doing very little to promote it or build the brand.

I am not sure even diesel gate was enough of an existential wake-up call for them.  Sitting here in Columbus eating popcorn and watching....

I could actually see them bringing Skoda over from Europe or something to re launch themselves before I could see them abandoning the segment.

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21 minutes ago, dfelt said:

Maybe VW will leave the segment. ;) They can afford too.

 

They just need to sell the Euro Passat here.

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2 hours ago, Frisky Dingo said:

 

They just need to sell the Euro Passat here.

A lot more than that....!

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1 hour ago, A Horse With No Name said:

A lot more than that....!

I meant in terms of this segment in particular.

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28 minutes ago, Frisky Dingo said:

I meant in terms of this segment in particular.

Thanks for clarifying!

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I took abuse by many for saying the 200 and Dart were doomed to failure. 

Here is the problem. You can not just revamp a Fiat product with a nicer looking body and expect it to be right. Fiat and Sergio has raped Chrysler and doomed their car lines. They are taking the profits from their Jeep and Ram trucks and putting it into the other Fiat brands which is like flushing money down the toilet. They should have funded Chrysler to do their own cars and funded a new RWD platform that should have been out 3 years ago.

As it is now they are still looking for a partner that I suspect at some point may be a Chinese automaker just because they will want the Jeep and Ram trucks. They will pick the bones and not much more will be left in the end.

The fact is FCA can not abandon the small car segment. It will be needed in the future even if it is just for CUV models. A partner could offer this but there are so few takers. In the end I feel this whole deal is going to be a much bigger mess in the future. The new regulations will kill them before it is all said and done.

Even VW now with the money trouble is not interested in Jeep and Ram.

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3 hours ago, hyperv6 said:

I took abuse by many for saying the 200 and Dart were doomed to failure. 

Here is the problem. You can not just revamp a Fiat product with a nicer looking body and expect it to be right. Fiat and Sergio has raped Chrysler and doomed their car lines. They are taking the profits from their Jeep and Ram trucks and putting it into the other Fiat brands which is like flushing money down the toilet. They should have funded Chrysler to do their own cars and funded a new RWD platform that should have been out 3 years ago.

As it is now they are still looking for a partner that I suspect at some point may be a Chinese automaker just because they will want the Jeep and Ram trucks. They will pick the bones and not much more will be left in the end.

The fact is FCA can not abandon the small car segment. It will be needed in the future even if it is just for CUV models. A partner could offer this but there are so few takers. In the end I feel this whole deal is going to be a much bigger mess in the future. The new regulations will kill them before it is all said and done.

Even VW now with the money trouble is not interested in Jeep and Ram.

This, times one hundred.

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Guest Howie
20 hours ago, A Horse With No Name said:

Highly doubtful They are one of the worlds largest and most profitable car companies and they desperately want the US market for economies of scale.(...)

(,,,) If anything, they need a small crossover. the Honda HRV actually outsold the Camry last month, and building a desirable version of something like that is very much in VW's DNA.  It's actually far more plausible for VW to build and sell something like that than the Atlas concept we were shown.(...)

(...) I could actually see them bringing Skoda over from Europe or something to re launch themselves before I could see them abandoning the segment. (...)

I think you mean the CR-V. The smaller HR-V sells 4 times less. VW is one of the largest (actually the largest so far this year) but not one of the most profitable. Partly because of diesal-gate fees but mainly because of the cost of brands acquisitions needed to become the largest. I sure agree about the Atlas, their poor target marketing and soulless cheaper offering in US. Sounds like old GM...

They do a better job with their Skoda's versions (VW itself spreads rumors about bringing them to US) and new platform. So there is hope, but time is running.

15 hours ago, hyperv6 said:

(,,,) You can not just revamp a Fiat product with a nicer looking body and expect it to be right. Fiat and Sergio has raped Chrysler and doomed their car lines. They are taking the profits from their Jeep and Ram trucks and putting it into the other Fiat brands which is like flushing money down the toilet

(...) As it is now they are still looking for a partner that I suspect at some point may be a Chinese automaker just because they will want the Jeep and Ram trucks. They will pick the bones and not much more will be left in the end.

Can't agree more ! When the boss of the company himself says some of their products aren't great, you have to wonder. Honesty is a good politic but so is being able to learn from mistakes and correct a situation.

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It is sad because it is actually a very nice car.  I thoroughly enjoyed the rental we had as they had apparently even sorted out the transmission issues on that one.  I would still love to see them partner with Mazda as a version of the 6 with the latest pentastar PUG would be a gem IMHO.  

 

As for crossovers and SUVs, this isn't only happening at FCA as everyone from Ford to Toyota, to Cadillac are pumping out and have plans for more CUVs while their cars don't see much in the way of upgrades.  We are at a point where CUVs are nearly as fuel efficient as their sedan counterparts.  Even if fuel prices go up, the jump towards CUVs and SUVS will not change as we are not talking about a 98 Blazer that can barely touch 20 MPG on the highway, but rather super fuel efficient CUVs such as the new CRV which i would be surprised to see rated in the mid 30s on the highwa with the new 1.5T.  You have to make what the public wants as much as those of us that love cars may hate it. 

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On 11/3/2016 at 4:20 PM, hyperv6 said:

I took abuse by many for saying the 200 and Dart were doomed to failure. 

Here is the problem. You can not just revamp a Fiat product with a nicer looking body and expect it to be right. Fiat and Sergio has raped Chrysler and doomed their car lines. They are taking the profits from their Jeep and Ram trucks and putting it into the other Fiat brands which is like flushing money down the toilet. They should have funded Chrysler to do their own cars and funded a new RWD platform that should have been out 3 years ago.

As it is now they are still looking for a partner that I suspect at some point may be a Chinese automaker just because they will want the Jeep and Ram trucks. They will pick the bones and not much more will be left in the end.

The fact is FCA can not abandon the small car segment. It will be needed in the future even if it is just for CUV models. A partner could offer this but there are so few takers. In the end I feel this whole deal is going to be a much bigger mess in the future. The new regulations will kill them before it is all said and done.

Even VW now with the money trouble is not interested in Jeep and Ram.

 

Yep...though I agreed with ya....

 

Also not sure how Jeep's luck is going to hold out either, starting with these new smaller CUVs....

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Jeep is providing a good design in the Renegade. This again goes to corporate culture though as they have major quality control issues they are unwilling to deal with.

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i actually don't think the 200 is so bad.  But here is part of why it hasn't lit up the sales charts, apart from it's competitiveness issues.

1- it's a classic tweener.  it's a bit small to really be a true midsize.  

2-chrysler's own 300 in the showroom selling at huge discounts.

I actually looked at some used 200's before leasing the Malibu this year, but the more i read into the teething pains with the 9 speed automatic across Chrysler's product line, i didn't want anything to do with it.

The v6 AWD 200 to me is a nice option.

It doesn't even really matter how many of the 200 Chrysler sells.  They can fleet whatever they don't sell retail.  If they drop it they do run risk of what do they sell when gas hits 5 dollars.  The issue is to size it correctly and not put Fiat guts in it IMO.

Next Chrysler 300 is to be spun off the minivan.  That's a good move for the 300 but honestly unless Chrysler comes out with its own Equinox and Edge they'll need something downmarket in the showroom from the 300.  Not everyone wants a Jeep.

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I wonder if Chrysler itself will also go away at some point.

...and the whole fleet what does not sell is a huge part of the reason that Honda products hold this value so much better.

TLX is down 20 percent, and last I checked they were not even offering zero percent to move metal.

Honda seems smart with production.  GM send by far and away the best of the bunch but currently they have lots of money on the hood of the Camaro and a ton of unsold Camaros.

Methinks my next ride may well be Asian at this point.

Edited by A Horse With No Name

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      The Wall Street Journal reported yesterday that tariffs as high as 25 percent could be slapped on new cars. Currently, the tariff on imported vehicles is at 2.5 percent. Imported trucks are already hit with a 25 percent tariff via the chicken tax.
      There are a couple likely reasons for this investigation,
      Mid-term elections are coming up and this is seen as a way to court voters in the heartland with the promise of bringing back jobs to the U.S. Possibly being used as leverage in negotiations with Canada and Mexico over the North American Free Trade Agreement (NAFTA); the European Union, and China. This investigation could hurt Mexico the most as they are the largest source of U.S. auto imports - delivering just under $50 billion of imports last year. As for automakers, Bloomberg reports that Jaguar Land Rover, Mazda, and Mitsubishi would be the most affected as all of their vehicles are imported. The news sent the stock prices of foreign automakers downward. Shares in Mazda dropped 5.2 percent at the close of trade in Japan, while Daimler and BMW saw their stock price drop more than two percent.
      This announcement has gotten condemnation from various governments, trade groups, analysts, and automakers. Here are just a few.
      "China opposes the abuse of national security clauses, which will seriously damage multilateral trade systems and disrupt normal international trade order," said Gao Feng, spokesman at the Ministry of Commerce in China during a regular press briefing.
      "We will closely monitor the situation under the U.S. probe and fully evaluate the possible impact and resolutely defend our own legitimate interests."
      “We have to consider this as something of a provocation. I have the growing impression that the U.S. no longer believes in the competition of ideas, but only the law of power. It fills me with grave concern,” said Eric Schweitzer, president of the Association of German Chambers of Commerce and Industry.
      “The U.S. auto industry is thriving and growing. To our knowledge, no one is asking for this protection. This path leads inevitably to fewer choices and higher prices for cars and trucks in America,” said  John Bozzella, CEO of the Association of Global Automakers, a trade group that represents Hyundai, Nissan, Toyota, and others.
      Source: Automotive News (Subscription Required), Bloomberg, Reuters, Wall Street Journal (Subscription Required), U.S. Department of Commerce


      U.S. Department of Commerce Initiates Section 232 Investigation into Auto Imports
      Today, following a conversation with President Donald J. Trump,  U.S. Secretary of Commerce Wilbur Ross initiated an investigation under Section 232 of the Trade Expansion Act of 1962, as amended.  The investigation will determine whether imports of automobiles, including SUVs, vans and light trucks, and automotive parts into the United States threaten to impair the national security as defined in Section 232.  Secretary Ross sent a letter to Secretary of Defense James Mattis informing him of the investigation.
      “There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry,” said Secretary Ross. “The Department of Commerce will conduct a thorough, fair, and transparent investigation into whether such imports are weakening our internal economy and may impair the national security.” 
      During the past 20 years, imports of passenger vehicles have grown from 32 percent of cars sold in the United States to 48 percent.   From 1990 to 2017, employment in motor vehicle production declined by 22 percent, even though Americans are continuing to purchase automobiles at record levels.  Now, American owned vehicle manufacturers in the United States account for only 20 percent of global research and development in the automobile sector, and American auto part manufacturers account for only 7 percent in that industry.  
      Automobile manufacturing has long been a significant source of American technological innovation. This investigation will consider whether the decline of domestic automobile and automotive parts production threatens to weaken the internal economy of the United States, including by potentially reducing research, development, and jobs for skilled workers in connected vehicle systems, autonomous vehicles, fuel cells, electric motors and storage, advanced manufacturing processes, and other cutting-edge technologies.  
      Following today’s announcement, the Department of Commerce will investigate these and other issues to determine whether imports of automobiles and automotive parts threaten to impair the national security.  A notice will be published shortly in the Federal Register announcing a hearing date and inviting comment from industry and the public to assist in the investigation.
    • By William Maley
      Author's Note: As we reported last month, General Motors will be reporting their sales numbers quarterly. The next time you will see GM and their subsequent brands will be in June. -WM
      Volvo Cars of North America, LLC - Up 17% (8,333 Vehicles Sold This Month, 28,416 Vehicles Sold This Year)
      Audi of America - Up 7.4% (20,090 Vehicles Sold This Month, 50,052 Vehicles Sold This Year)
      FCA US LLC - Up 5% (184,149 Vehicles Sold This Month, 698,918 Vehicles Sold This Year)
      Volkswagen of America - Up 4.5% (28,794 Vehicles Sold This Month, 112,746 Vehicles Sold This Year)
      BMW Group U.S. - Up 4.2% (27,213 Vehicles Sold This Month, 111,581 Vehicles Sold This Year)
      Mercedes-Benz USA - Up 2.1% (30,115 Vehicles Sold This Month, 117,096 Vehicles Sold This Year)
      Subaru of America, Inc. - Up 1.5% (53,170 Vehicles Sold This Month, 202,873 Vehicles Sold This Year)
      Porsche Cars North America, Inc. - Up 0.7% (5,570 Vehicles Sold This Month, 19,524 Vehicles Sold This Year)
      Jaguar Land Rover North America - 0% (8,467 Vehicles Sold This Month, 40,762 Vehicles Sold This Year)
      Mazda North American Operations - Down 4.6% (23,056 Vehicles Sold This Month, 107,051 Vehicles Sold This Year)
      Mitsubishi Motors North America - Down 4.6% (7,990 Vehicles Sold This Month, 43,762 Vehicles Sold This Year)
      Ford Motor Company -  Down 4.7% (204,651 Vehicles Sold This Month, 804,232 Vehicles Sold This Year)
      Toyota Motor North America - Down 4.7% (192,348 Vehicles Sold This Month, 764,381 Vehicles Sold This Year)
      Kia Motors America - Down 5.2% (50,585 Vehicles Sold This Month, 177,530 Vehicles Sold This Year)
      American Honda Motor Co. - Down 9.2% (125,701 Vehicles Sold This Month, 488,192 Vehicles Sold This Year)
      Maserati North America, Inc. - Down 24.9% (950 Vehicles Sold This Month, 3,663 Vehicles Sold This Year)
      Nissan North America - Down 28.1% (87,764 Vehicles Sold This Month, 503,767 Vehicles Sold This Year)

      Hyundai Motor America - 

      Brands:
      Acura - Down 15.9% (11,888 Vehicles Sold This Month, 45,302 Vehicles Sold This Year)
      Alfa Romeo - Up 173% (1,847 Vehicles Sold This Month, 7,639 Vehicles Sold This Year)
      Audi - Up 7.4% (20,090 Vehicles Sold This Month, 50,052 Vehicles Sold This Year)
      BMW - Up 3.8% (23.482 Vehicles Sold This Month, 97,317 Vehicles Sold This Year)
      Chrysler - Down 18% (14,189 Vehicles Sold This Month, 60,422 Vehicles Sold This Year)
      Dodge - Up 4% (40,994 Vehicles Sold This Month, 157,965 Vehicles Sold This Year)
      Fiat - Down 45% (1,404 Vehicles Sold This Month, 5,418 Vehicles Sold This Year)
      Ford - Down 4.3% (196,133 Vehicles Sold This Month, 773,252 Vehicles Sold This Year)
      Genesis - 
      Honda - Down 8.4% (113,813 Vehicles Sold This Month, 422,890 Vehicles Sold This Year)
      Hyundai - 
      Infiniti - Down 17% (8,960 Vehicles Sold This Month, 49,847 Vehicles Sold This Year)
      Jaguar - Down 37% (2,019 Vehicles Sold This Month, 10,068 Vehicles Sold This Year)
      Jeep - Up 20% (82,641 Vehicles Sold This Month, 310,746 Vehicles Sold This Year)
      Kia - Down 5.2% (50,585 Vehicles Sold This Month, 177,530 Vehicles Sold This Year)
      Land Rover - Up 24% (6,448 Vehicles Sold This Month, 30,694 Vehicles Sold This Year)
      Lexus - Down 2.1% (21,642 Vehicles Sold This Month, 85,853 Vehicles Sold This Year)
      Lincoln - Down 12.1% (8,518 Vehicles Sold This Month, 30,980 Vehicles Sold This Year)
      Maserati - Down 24.9% (950 Vehicles Sold This Month, 3,663 Vehicles Sold This Year)
      Mazda - Down 4.6% (23,056 Vehicles Sold This Month, 107,051 Vehicles Sold This Year)
      Mercedes-Benz - Up 1% (27,207 Vehicles Sold This Month, 105,681 Vehicles Sold This Year)
      Mercedes-Benz Vans - Up 28.4% (2,815 Vehicles Sold This Month, 11,001 Vehicles Sold This Year)
      MINI - Up 7.2% (3,731 Vehicles Sold This Month, 14,264 Vehicles Sold This Year)
      Mitsubishi - Down 4.6% (7,990 Vehicles Sold This Month, 43,762 Vehicles Sold This Year)
      Nissan - Down 29.1% (78,804 Vehicles Sold This Month, 453,920 Vehicles Sold This Year)
      Porsche - Up 0.7% (5,570 Vehicles Sold This Month, 19,524 Vehicles Sold This Year)
      Ram Trucks - Down 9% (43,074 Vehicles Sold This Month, 156,728 Vehicles Sold This Year)
      Smart - Down 74.5% (93 Vehicles Sold This Month, 414 Vehicles Sold This Year)
      Subaru - Up 1.5% (53,170 Vehicles Sold This Month, 202,873 Vehicles Sold This Year)
      Toyota - Down 5.1% (170,706 Vehicles Sold This Month, 678,528 Vehicles Sold This Year)
      Volkswagen - Up 4.5% (28,794 Vehicles Sold This Month, 112,746 Vehicles Sold This Year)
      Volvo - Up 17% (8,333 Vehicles Sold This Month, 28,416 Vehicles Sold This Year)

      View full article
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