September New-Vehicle Retail Sales Decline; Incentives Reach Highest Level Ever

DETROIT, Sept. 26, 2016 /PRNewswire/ -- For the fifth time in the past seven months, U.S. new-vehicle retail sales are expected to drop in September, falling 1.4% from a year ago, according to a monthly sales forecast developed jointly by J.D. Power and LMC Automotive.

Retail sales are on pace to reach 1,185,500 units in September, while total sales are projected to fall 0.8% to 1,429,100.

Labor Day weekend is typically one of the highest volume sales weekends in the year. The weekend's sales this September were 199,493 units, a 1% decrease compared with 2015. This decline was despite elevated incentive programs from manufacturers. In fact, incentive spending thus far in September is at a record level of $3,923 per unit, surpassing the previous high of $3,753 set in December 2008.

Deirdre Borrego, senior vice president and general manager of automotive data and analytics at J.D. Power, said: "The industry can be viewed through two competing perspectives. The first is that in absolute terms, the industry is performing at an exceptional level. While sales have fallen slightly, they are at near-record levels and transaction prices are at all-time highs. The second is less positive. With the rate of growth slowing, leading indicators are pointing to challenges ahead. Specifically in September, incentive spending is at an all-time high.

Retail sales year to date through September are expected to be down 1.3%, compared with the same period in 2015, while total sales are expected to be up 0.5%.

Jeff Schuster, senior vice president of forecasting at LMC Automotive, said: "The U.S. automotive market continues to show signs of little growth, yet in our opinion the numbers do not reflect a significant weakness or risk. The expectation remains for steady volume levels at the topline, despite a pullback in the retail market and increased monthly performance volatility. However, group and brand performance is beginning to diverge as competitive pressure is at an all-time high."

• The seasonally adjusted annualized rate (SAAR) for retail sales in September 2016 is projected to reach 14.9 million units, down from 15.2 million units in September 2015. The SAAR for total sales is projected at 17.7 million units in September 2016, down from 18.0 million units a year ago.
• Fleet sales are expected to reach 243,600 in September, a 2.1% increase from September 2015, and account for 17.0% of total light-vehicle sales.
• LMC Automotive's forecast for full-year total light-vehicle sales forecast remains at 17.4 million units, 0.3% decline from 2015. The forecast for retail light-vehicle sales is 14.0 million units, down 1.6% from 2015.
• The average new-vehicle retail transaction price thus far in September is $30,665, a record for the month— surpassing the previous high of $30,473 in September 2015.
• Trucks account for 60.8% of new-vehicle retail sales so far in September, poised to match the record for any month set in July 2016. Pickups account for 15.9% of sales in the month.

About J.D. Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info
About LMC Automotive 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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