WESTLAKE VILLAGE, Calif., Oct. 23, 2015 /PRNewswire/ -- New-vehicle retail and total sales in October 2015 are expected to be the strongest for the month since 2001, according to a monthly sales forecast developed jointly by J.D. Power and LMC Automotive.
Benefitting from having five weekends—rather than the four weekends typical of most Octobers—sales in October 2015 are expected to exceed 1.1 million units, making it the strongest October since 2001, when automakers' zero-percent financing incentives propelled new-vehicle retail sales to 1.6 million units.
Retail Light-Vehicle Sales
Although retail light-vehicle sales in October 2015 are down from 1.2 million units in September, they are up 5 percent on a selling-day adjusted basis compared with October 2014. The seasonally adjusted annualized rate (SAAR) for retail sales in October 2015 is expected to reach 14.3 million units, a 770,000-unit increase from the selling rate in October 2014 (13.5 million units). Retail transactions are the most accurate measure of true underlying consumer demand for new vehicles.
"September was a strong month—bolstered by the Labor Day weekend—so the expectation is that we would see some weakness is subsequent months, but that hasn't been the case," said John Humphrey, senior vice president of the global automotive practice at J.D. Power. "Through the first 18 days in October, retail sales are up 7 percent compared with the same period a year ago."
While sales are strong, they have not been evenly distributed, as truck sales in October are up 15 percent year over year, while car sales have slipped 2.6 percent. Pickups and SUVs combined account for 58 percent of retail sales thus far this month.
"Given the continued pressure on car segments, manufacturers are responding with greater incentive spending on cars," said Humphrey. "While incentive spending on cars has risen 16 percent year over year, truck incentive spending is up just 2 percent compared with October 2014."
Car incentive spending is currently $650 per unit higher than truck incentive spending.
Total Light-Vehicle Sales
Total light-vehicle sales are expected to approach 1.4 million in October 2015, a 4.4 percent increase on a selling-day adjusted basis compared with October 2014. The SAAR for total sales in October is expected to be 17.4 million units, an 840,000-unit increase from the selling rate in October 2014.
Fleet volume is projected at 238,100 units, a 1 percent increase on a selling-day adjusted basis from October 2014. Fleet sales are expected to account for 17.2 percent of total sales in October 2015, down slightly from 17.7 percent in October 2014. After a stronger start to the year, since June fleet volume has settled in at a level below that of a year ago.
J.D. Power and LMC Automotive U.S. Sales and SAAR Comparisons
| October 20151 |
September 2015 |
October 2014 |
|
| New-Vehicle Retail Sales |
1,145,900 units2 (5.0 % higher than October 2014) |
1,201,909 units |
1,052,121 units |
| Total Vehicle Sales |
1,384,000 units (4.4% higher than October 2014) |
1,440,503 units |
1,278,629 units |
| Retail SAAR |
14.3 million units |
15.3 million units |
13.5 million units |
| Total SAAR |
17.4 million units |
18.1 million units |
16.5 million units |
1Figures cited for October 2015 are forecasted based on the first 15 selling days of the month.
2The percentage change is adjusted based on the number of selling days in the month (28 days in October 2015 vs. 27 days in October 2014).
Sales Outlook
Light-vehicle sales are showing no signs of letting up. As a result, LMC Automotive is raising its 2015 total light-vehicle sales forecast to 17.3 million units from 17.2 million units and its retail light-vehicle forecast to 14.2 million units from 14.1 million units.
"The tenacious pace of auto sales since May, combined with the current favorable position of the U.S. economy, is increasing the level of upside potential to 2015 by 100,000 units, while nearly wiping out any downside risk," said Jeff Schuster, senior vice president of forecasting at LMC Automotive. "Looking forward, the forecast for 2016 is 17.6 million units, but growing economic stability and consumer confidence could easily push light-vehicle sales toward 17.8 million units next year."
North American Production
North American production in September 2015 was 1.58 million units, the same level as in August 2015 but a 3.4 percent increase compared with September 2014. Production levels were increased to improve inventory levels to a 60-day supply from a 55-day supply in August, but lower than the 64-day supply in September 2014. LMC Automotive's 2015 production forecast remains at 17.5 million units, a 500,000-unit increase from 2014. LMC is forecasting 2016 to reach 17.9 million units.
About J.D. Power
J.D. Power is a global marketing information services company providing performance improvement, social media and customer satisfaction insights and solutions. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. Power Information Network (PIN) from J.D. Power has revolutionized the automotive industry by collecting and analyzing real-time transaction-level data for new and used vehicles. PIN's data and analytics help automakers and dealers manage risk, monitor metric performance and improve business results. Headquartered in Westlake Village, Calif., J.D. Power has offices in North/South America, Europe and Asia Pacific. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit www.JDPower.com. J.D. Power is a business unit of McGraw Hill Financial.
About McGraw Hill Financial
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include Standard & Poor's Ratings Services, S&P Capital IQ and SNL, S&P Dow Jones Indices, Platts, CRISIL and J.D. Power. The Company has approximately 20,000 employees in 31 countries. Additional information is available at www.mhfi.com.
About LMC Automotive
LMC Automotive is the premier supplier of automotive forecasts and intelligence to an extensive client base of automotive manufacturer, component supplier, logistics and distribution companies, as well as financial and government institutions around the world. LMC's global forecasting services encompass automotive sales, production and powertrain expertise, as well as advisory capability. LMC Automotive has locations in the United States, the UK, France, Germany, China, Japan and Thailand and is part of the Oxford, UK-based LMC group, the global leader in economic and business consultancy for the agribusiness sector. For more information please visit www.lmc-auto.com.
Media Relations Contacts
John Tews; J.D. Power; Troy, Mich.; 248-680-6218; [email protected]
Emmie Littlejohn; LMC Automotive; Troy, Mich.; 248-817-2100; [email protected]
No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power or LMC Automotive. www.jdpower.com/corporate www.lmc-auto.com
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SOURCE J.D. Power
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