Tag Archive | "Kelley Blue Book"

KBB Predicts 12% Increase in New-Vehicle Sales


IRVINE, Calif. — Kelley Blue Book said this week it expects new-vehicle sales to increase nearly 12% year over year to a total of 1.43 million units in October, a predication that would put the seasonally adjusted annual rate at 197.9 million if realized. It would also be the highest October sales total since 2001.

Fueling the vehicle information site’s double-digit growth prediction is new-vehicle sales continue to roll off dealer lots after the industry experienced its strongest sales month in over a decade in September. Employment and fuel prices are other drivers of KBB’s prediction.

“Key economic indicators for auto sales are still strong, including jobless claims at a historic low as the national unemployment rate approaches 5%, fuel pricing nearing six-year lows, and interest rates that remain near zero,” said Alec Gutierrez, senior analyst for Kelley Blue Book. “This momentum has pushed Kelley Blue Book’s forecast to 17.4 million for 2015, a 5.6% year-over-year improvement.”

Sales Volume 

Market Share 2

Manufacturer

Oct-15

Oct-14

YOY %

Oct-15

Oct-14

YOY %

General Motors (Buick, Cadillac, Chevrolet, GMC)

250,000

226,819

10.2%

17.5%

17.8%

-0.3%

Ford Motor Company (Ford, Lincoln)

219,000

187,897

16.6%

15.3%

14.7%

0.6%

Toyota Motor Company (Lexus, Scion, Toyota)

198,000

180,580

9.6%

13.8%

14.1%

-0.3%

Fiat Chrysler (Chrysler, Dodge, FIAT, Jeep, RAM)

191,000

170,480

12.0%

13.4%

13.3%

0.0%

American Honda (Acura, Honda)

135,000

121,172

11.4%

9.4%

9.5%

0.0%

Nissan North America (Infiniti, Nissan)

120,000

103,117

16.4%

8.4%

8.1%

0.3%

Hyundai-Kia

110,000

94,775

16.1%

7.7%

7.4%

0.3%

Volkswagen Group (Audi, Volkswagen, Porsche)

50,000

49,130

1.8%

3.5%

3.8%

-0.3%

Total 3

1,430,000

1,277,821

11.9%

Historical data from OEM sales announcements

While General Motors is expected to lead the way in sales volume, Ford Motor Co.’s expected 16.6% increase in new-vehicle sales from a year ago would be the biggest gain in October. Expected to lead the way, according to KBB, is the F-150, which is pushing overall F-Series volume to new levels of growth this year. Ford’s refreshed Explorer should also be a solid driver of growth this year for the automaker.

The Volkswagen Group is also expected to show a slight gain in sales volume, despite its recent troubles, the site noted. “With most brands experiencing growth this month, Volkswagen Group should report fairly even sales totals in the wake of their diesel emissions issue,” said Gutierrez. “Audi and Porsche will be driving the sales growth for the manufacturer, as the Volkswagen brand posts negative figures, largely due to the stop-sale of its diesel models, which previously made up nearly 20 percent of the brand’s sales volume.”

By vehicle segment, compact utility vehicles are expected to lead the way for the third month in a row with nearly 40% growth. This segment has seen five new models enter the segment in the past year, which has resulted in more than 20,000 units sold per month. Still, the rest of the segment continues to strengthen at double the rest of the industry’s pace.

With low fuel prices and exploding popularity of small utilities, small and mid-size cars will continue to lose market share in October. These are already two of the most competitive segments in the market, and year-to-date sales in both segments have declined. While Kelley Blue Book said it expects an increase in volume in October, due to strong overall sales momentum in the automotive industry, it also believes market share will drop by more than a full percentage point for these car segments.

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Kelley Blue Book Adds Self-Service Portal for Mass Vehicle Valuations


IRVINE, Calif. — Kelley Blue Book now offers its customers a new self-service interface for easy access to new and used-car Kelley Blue Book Values and configuration data by vehicle identification number (VIN) within its suite of business-to-business solutions.

Kelley Blue Book Values incorporate more than 250 sources. Using flexible file formats, customers can quickly obtain current vehicle valuations in real time by simply inputting the desired batch VIN information using a Web-based interface.

“The latest addition to Kelley Blue Book’s suite of industry solutions gives customers easy access to useful VIN-specific data and timely, relevant new and used-vehicle valuations on their own time,” said Dan Ingle, vice president of valuations and industry solutions for Kelley Blue Book. “Leveraging Kelley Blue Book’s nearly 90 years of automotive expertise, providing trusted values, unparalleled data and integration tools for both new and used vehicles, we continue our mission to be a vital resource for our customers.”

All VIN-related information is obtained from factory data, and includes manufacturer order codes. Kelley Blue Book also provides all associated VIN trims, if more than one is identified from the decoding process.

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Spending on New Cars Hits All-Time High, Even as Loans Stretch to Record Lengths


While May might not have brought the big uptick in sales we’ve seen in recent months, preliminary data suggest that automakers took in record revenues, with the average transaction price of new cars, trucks and crossovers sold last month climbing by at least 4%, reports The Detroit Bureau. 

All told, U.S. buyers spent a record $52 billion for their new vehicles in May, in part, due to a sharp, year-over-year decline in incentives, according to several firms that track monthly sales data. A separate study suggested that motorists are covering those higher costs by stretching their loans out longer than the industry has ever seen, an average 67 months.

“New vehicle sector and segment preference indicates consumers are confident about the economy and their finances,” said TrueCar President John Krafcik. “Not only are these shifts to premium brands and utilities telling from an economic indicator standpoint, they signal sizable revenue gains automakers should reap this year.”

The data tracking firm estimated that the typical vehicle had an average transaction price, or ATP, of $32,452, up 4% rom May 2014. Lower incentives played a role, but manufacturers have also seen buyers show more confidence by loading up on options and by trading up to higher-level vehicles. TrueCar estimated sales of premium brands jumped 10.6% during the first four months of 2015 compared to just 4.8% for mainstream brands.

BMW and its Mini subsidiary, saw prices jump in May by 6.5%, according to a separate analysis by Kelley Blue Book. Mazda saw a similar increase, while Ford and General Motors prices climbed a more modest 4.3% and 4.2% respectively. Toyota’s average price rose just 2.3%, even though it trimmed incentives by more than 10%, year-over-year.

With only a handful of exceptions, notably including General Motors, Hyundai and Kia, most makers trimmed rebates and givebacks as the U.S. auto market continued to gain ground. And analysts noted that the modest overall sales numbers for May actually misrepresent the market’s momentum, as the peculiarities of the industry’s reporting system counted fewer so-called “sales days” last month than in May 2014.

The surge in spending also reflects a year-long shift from fuel-efficient small cars and alternative-power vehicles to larger passenger cars, pickups and SUVs.

“With the national average price of gasoline down nearly a dollar per gallon on average from one year ago, truck and SUV demand remains strong, elevating average transaction prices,” Karl Brauer, senior analyst for Kelley Blue Book, said in a statement.

The steady climb in new car prices might come as a surprise to those worried about relatively stagnant middle-class earnings and the rising wealth gap. In reality, most new car buyers today register on the upper end of the middle-class spectrum. Even for compact cars, industry research often shows household income levels approaching six figures.

And buyers are simply stretching out their purchases to hold down monthly payments – while also encouraged by continuing low interest rates. Gone are the days of three and even four-year loans. Borrowers extended their loans terms during the previous quarter to 67 months on average, longer than ever for new cars, according to Experian Automotive.

“While longer term loans are growing, they do not necessarily represent an ominous sign for the market,” said Melinda Zabritski, Experian’s senior director of automotive finance.

On the plus side, the trend allows consumers to buy more vehicle without busting the household budget. On the downside, however, it means they likely have to keep those vehicles longer in order to avoid being upside-down on loans when trading in, cautioned Zabritski. That could foretell slower future growth of the automotive market.

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KBB: Car Shoppers Confident in ‘New’ GM


IRVINE, Calif. — Fifty percent of new-car shoppers think GM is a different company today compared to five years ago, while only 24% of new-car shoppers believe the ‘old’ GM still exists, reports Kelley Blue Book.

“Despite challenges with the recall announcements, General Motors CEO Mary Barra has successfully positioned the brand in a positive light, as evidenced by Kelley Blue Book’s survey results showing half of new-car shoppers think GM has changed in recent years,” said Tony Lim, director of research for Kelley Blue Book’s KBB.com. “By reinforcing the message of the ‘new’ GM and distancing itself from the ‘old,’ Barra can continue to effectively distinguish the company from its past.”

The survey data also revealed more than a quarter of new-car shoppers think GM is being proactive and transparent regarding the recalls.

“GM initiated the ignition switch recall versus having it ordered by the government, and the company’s proactive stance taken in the areas of vehicle safety oversight and victim compensation has enhanced the automaker’s image despite the high number of recalled models,” said Karl Brauer, senior analyst for Kelley Blue Book’s KBB.com. “GM is suggesting to consumers it is more transparent about quality and the safety of its owners.”

However, U.S. car buyers continue to question GM’s product quality, as the survey indicates mixed feelings regarding the manufacturer’s ability to make more reliable vehicles today than it did five years ago. Only 39% of surveyed new-car shoppers think that GM’s current products are more reliable when compared to five years ago.

“High-profile recalls will put pressure on views of quality and reliability for any brand, and while many consumers think GM is a different company today, inevitably perceptions of product unreliability still exist,” said Lim. “GM can overcome these challenges and change perceptions by focusing efforts on new-vehicle launches and commitment to innovative in-vehicle technology.”

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Cox Acquires 25% Stake in AutoTrader Group


Atlanta and Providence, R.I. — Cox Enterprises Inc. and Providence Equity Partners announced a definitive agreement by which Cox will acquire Providence Equity’s 25% equity interest in AutoTrader Group. Cox Enterprises now holds a 98% stake in AutoTrader Group, with the remainder being held by current and former employees. Financial terms of the transaction were not disclosed.

“With more than 32 million monthly visitors to our industry-leading sites, AutoTrader.com and KBB.com, AutoTrader Group continues to grow as a trusted and valued online automotive resource for customers across the nation. Our portfolio of media advertising and software products serves more than 27,000 dealer relationships, and we are confident we will continue to lead the way in connecting automotive dealers with the car-buying public,” said Cox Enterprises’ President and CEO John Dyer. “We have greatly appreciated Providence’s strong contributions to the company’s exceptional performance as a partner in this growth.”

Providence Equity acquired a 25 percent stake in AutoTrader in 2010 to help accelerate the company’s growth. Since that time, AutoTrader acquired Haystak Digital Marketing, HomeNet Automotive, Kelley Blue Book, vAuto and VinSolutions. The collective companies now constitute AutoTrader Group.

“We are extremely gratified to have partnered with Cox and the AutoTrader team,” said Providence’s Managing Director Michael Dominguez. “Through strategic acquisitions and the introduction of dealer software solutions, they have advanced the original vision of the company and created a game changer. We are proud to have contributed to its growth and believe the company has a very bright future ahead.”

AutoTrader Group operates a digital automotive marketplace and provides marketing and software solutions to automotive dealers throughout the United States. The company touches more than 62% of in-market automotive shoppers. AutoTrader Group also holds a 21.8% stake in Bitauto, a provider of Internet content and marketing services for China’s automotive industry.

“Since we launched AutoTrader.com 15 years ago, we have worked tirelessly to meet the needs of our customers by expanding our online and software products. With this acquisition, Cox Enterprises and AutoTrader Group will continue to look for opportunities to grow our leadership position and further innovate ways to meet the needs of car buyers,” said Dyer.

Cox Enterprises also owns and operates Manheim, a global provider of vehicle remarketing services. It registers nearly eight million used vehicles annually, facilitating transactions representing more than $50 billion in value.

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Conflicting Reports on Transaction Pricing in Dec. 2013


Santa Monica and Irvine, Calif. – TrueCar.com and Kelley Blue Book both released their numbers on transaction pricing for December 2013, and while the two usually have similar results, for this month there is a huge gap.

TrueCar.com noted that the average transaction price (ATP) for light vehicles in the U.S. was $30,786 in December 2013, down $201 (-0.6 percent) from December 2012; and down $35 (-0.1 percent) from November 2013. Kelley Blue Book’s numbers, however, showed that new-car transaction prices increased an average of $197 per month-over-month in December 2013, with the estimated average transaction price for light vehicles in the United States sitting at $32,890, up 0.6 percent, and down $159 (0.5 percent) year-over-year.

“Incentives, as a percentage of transaction price, are up for several brands – a trend worth keeping an eye on,” said Larry Dominique, executive vice president, TrueCar, and president, ALG. “Chrysler is one automaker that appears to buck this trend, showing positive momentum with a key product launch imminent.”

“Along with solid new-car sales, average transaction prices on new vehicles continue to strengthen this year,” said Alec Gutierrez, senior analyst, Kelley Blue Book. “Honda average transaction prices remain flat from last month, but are up a respectable 2.5 percent year-over-year with strong Acura prices (up 10.8 percent year-over-year), primarily due to the new MDX. Chrysler also revealed a solid increase year-over-year, thanks to better performance from its Jeep lineup. Jeep alone was up 2.5 percent year-over-year on the Grand Cherokee and Wrangler, while the Chrysler brand climbed 2.2 percent from this time last year due to a lower mix of its 200 model.”

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