WESTLAKE VILLAGE, Calif., Oct. 21 /PRNewswire/ -- New-vehicle retail sales in October are building upon the strength from September and exhibiting signs of a more pronounced recovery trend, according to J.D. Power and Associates, which gathers real-time transaction data from more than 8,900 retail franchisees throughout the United States.
Retail Light-Vehicle Sales
October new-vehicle retail sales are expected to come in at 756,300 units, which represents a seasonally adjusted annualized rate (SAAR) of 10.2 million units—making October the first month to reach a 10-million-unit selling rate this year. Retail transactions are the most accurate measurement of true underlying consumer demand for new vehicles.
"Unlike July, August and September, which experienced some mid-month weakness, October's robust sales pace has continued through the second week," said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. "Coming off a strong close to September, October's expected performance marks the first back-to-back months of strength since the spring. Despite the drag from high unemployment and lower incentive levels, improvement in the automotive market continues in October, suggesting that consumers are discounting the negative sentiment."
Total Light-Vehicle Sales
Total light-vehicle sales for October are expected to come in at 922,700 units, 14 percent higher than October 2009. Fleet sales in October are expected to be up 3 percent from one year ago, representing an 18 percent share of total sales. October is typically a month with a lower level of fleet sales, but October fleet volume is expected to be the lowest of the year.
J.D. Power and Associates U.S. Sales and SAAR Comparisons
New-vehicle retail sales
(17% higher than October 2009)(2)
Total vehicle sales
(14% higher than October 2009)
10.2 million units
9.5 million units
9.0 million units
11.9 million units
11.7 million units
10.4 million units
(1) Figures cited for October 2010 are forecasted based on the first 14 selling days of the month.
(2) The percentage change is adjusted based on the number of selling days (27 days vs. 28 days one year ago).
As the industry continues to improve at a slower-than-anticipated pace, J.D. Power and Associates is revising its 2010 forecast downward slightly to 9.1 million units for retail sales (from 9.2 million units) and 11.5 million units for total sales (from 11.6 million units).
Gross domestic product in 2011 is now expected to grow at the same rate as in 2010, approximately 2.5 percent. Given the weaker economic outlook for next year, the 2011 forecast has also been revised to 10.5 million units for retail sales (from 10.7 million units) and 12.9 million units for total sales (from 13.2 million units).
North American Production
North American production volume in the first three quarters of 2010 has already exceeded production for all of 2009, with 8.9 million units produced, compared with 8.5 million vehicles last year. Fourth-quarter production in 2010 is expected to be 2.8 million units, compared with 2.7 million units in 2009. The forecast for 2010 has edged up to 11.7 million units, an improvement of 37 percent compared with 2009.
Vehicle inventory rose slightly from September to 58 days supply with 2.2 million units in stock. However, the overall level continues to be well-balanced with demand and inventory remains below historical levels.
"Production for several high-profile models—such as the Chevrolet Cruze and Volt, Ford Explorer and Focus, and the Dodge Durango and Charger—will start this quarter or will continue to ramp up, driving a strong production recovery at the close of 2010," said Schuster. "North American production levels are expected to grow by an additional 1 million units in 2011 to 12.7 million."
About J.D. Power and Associates
Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.
About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies (NYSE: MHP) is a global information and education company providing knowledge, insights and analysis in the financial, education and business information sectors through leading brands including Standard & Poor's, McGraw-Hill Education, Platts, and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2009 were $5.95 billion. Additional information is available at http://www.mcgraw-hill.com/.
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SOURCE J.D. Power and Associates