Sales reporting used to be a pretty straightforward process of brands tallying up the sales booked by their U.S. dealers each month and putting the numbers in a formatted release that analysts and journalists could use to compare results with each other and with previous periods.
Yes, it has evolved over the years, from the economist-driven 10-day sales reports to the more business operations-oriented monthly releases. But those sales reports — especially when paired with inventory data and incentive estimates — provided a regular and reliable view into the performance of the industry as a whole and the automakers individually.
Transparency, shmansparency.
Over the past decade, that mechanism has been abused and mucked with. If it were an engine, it would be knocking and smoking, and the average oil change place would be afraid to touch it. If not for secret reports to certain banks and government institutions, there wouldn’t even be reliable calculations of the seasonally adjusted annual selling rate.
A lot of it started with the great disruptor, Tesla Inc.
CEO Elon Musk was determined to question everything in the industry: from the powertrain and fueling network to the retail model.
Tesla also disrupted sales reporting. It reported only quarterly, instead of monthly, and it included all of its global sales, not just those in the U.S. When the company was starting up, it didn’t matter much.
As it got bigger, we’ve had to use other ways — slower ways — to get a clear view of the market. We now pay about as much attention to registrations (five to six weeks after the month ends) as we do to sales.
But the problem has sprawled far beyond Tesla. General Motors and Stellantis now report U.S. sales only on a quarterly basis. JLR reports North America results, but not U.S. sales. Ford switched to quarterly, then back to monthly — but its report now comes a day later than others.
The latest evolution in sales reporting comes from Mercedes-Benz USA, which has taken to reporting its wholesales — the factory output that gets sold to dealers — not retail sales to actual customers. (The matter is complicated somewhat by the company’s unusual half-century of owning Mercedes-Benz Manhattan on 11th Avenue, though it appears to count those vehicles in the same way as other stores.)
The company explains that its purpose is to better align with financial filings and its global sales reports. And there’s a fair point that doing so gives investors a better view of the profits that will be announced a few weeks later.
As many Automotive News readers know, automakers book revenue when the car leaves the factory. They have done their part by making the car and selling it to the franchisee, which is a very reliable payer.
Tesla, which has no franchisees, publishes both quarterly production and delivery, which is actually quite helpful. Once it reported that first-quarter production exceeded deliveries by 46,561, you could pretty much count the minutes until the company cut its prices.
But what Mercedes shareholders don’t get to see in the company’s new-sales report is whether consumers are buying the vehicles. And that’s especially unfortunate when brands struggle to get their inventory in line with customer demands.
At the risk of seeming petty, I’ll admit I’m somewhat irked that the change by Mercedes-Benz USA adds another layer of chaos to our luxury sales tables. First, we decided to remove Tesla, since 96 percent of its sales are effectively mainstream vehicles. Now we’re stuck with Mercedes wholesale figures, which are entirely in control of the manufacturer — a function of factory output.
Statistically, most people would call it an “apples and oranges” problem. While the cars are literally the same cars — give or take a little prep work — from a value chain perspective, they are entirely different.
And yes, everything that’s wholesaled is eventually retailed. But the difference between inventory that turns in 15 days or 105 days is make or break for retailers. So substituting wholesale for retail is deeply unsatisfying.
Mercedes is far from the only brand finding that the market for six-figure EVs is pretty well saturated. I’ve been banging the drum that the race is on to bring affordable (and profitable and useful) EVs to market. Something in the ballpark of $25,000 that would deliver compelling value for the local drives to work, school and the grocery store that make up the vast majority of miles driven in the U.S.
Ford, Stellantis, Kia and Hyundai have all spoken about — or at least hinted at — plans to develop such vehicles. So did Tesla, though its intention is now less clear.
Reuters reported that Tesla has canceled plans for the so-called Model 2, presumably to focus on a robotaxi service. Musk, who has mused that self-driving cars could deliver cheaper miles than even an affordable EV, was not amused. “Reuters is lying,” he wrote on X, without elaboration.
Musk is not a particularly credible media critic: He once called an Associated Press reporter a “lobbyist” for reporting accurately about a safety recall. But he’s the one who will decide — or who may change his decision — about the lower-cost model. If he wants to prove Reuters is lying, all he has to do is offer an attractive, more-affordable EV.
Since then, he’s dropped a save-the-date note about a robotaxi reveal on Aug. 8. And indeed, there is also a race to develop self-driving cars that can pay for themselves while making roads much safer. Waymo is expanding, and Cruise is working to get back in the game.
There’s a lot of change and disruption in the industry, from the powertrain to the brain behind the wheel. Good data — and a clear understanding of the data at our disposal — is key to making good decisions.