Tag Archive | "new vehicle sales"

Selling Rate Pulls Back, Recovery Expected


WESTLAKE VILLAGE – New-vehicle retail sales in April are expected to continue the year-over-year growth trend from the first quarter, as the market heads into the spring selling season, according to a monthly sales forecast developed by J.D. Power and Associates’ Power Information Network® (PIN) and LMC Automotive.

April new-vehicle retail sales are projected to come in at 894,100 units, which represents a seasonally adjusted annualized rate (SAAR) of 10.2 million units. Volume is expected to increase by 8 percent, which is consistent with the year-over-year increase of 8 percent in the first quarter.

“The daily selling rate in April is projected at 37,000 units, which is higher than the 34,000-unit average in the first quarter,” said John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates. “While April is typically a challenging month to draw comparisons with because the Easter holiday some years falls in April and other years in March, the signs of sustained growth are evident.”

Industry sales growth has been concentrated in non-luxury vehicle segments. Luxury segments share of industry retail sales in April to date is 10.8 percent, down from 12.1 percent in April 2011.

“Despite the slip in market share for the luxury market, growth in overall sales is offsetting the risk to sales volumes,” said Humphrey. “That’s not to say there aren’t risks. Improved content and features in non-luxury vehicles offer good value proposition for consumers returning to the marketplace. In addition, there are a number of new and refreshed non-luxury models, and programs such as free maintenance provide consumers with a lower total cost of ownership.”

The decline in luxury share of retail sales is one of the reasons why lease penetration is down in April, as the luxury market typically has a higher lease penetration than the non-luxury market. Through the first 15 selling days in April, lease penetration overall is 17.7 percent — the lowest level since December 2009 and down from 20.2 percent in April 2011.

Total light-vehicle sales in April are expected to come in at 1.135 million units, an 11 percent increase from April 2011. A higher fleet mix continues into April, with fleet volume expected to represent 21 percent of total sales.

Based on the robust first quarter 2012 selling pace, which was 14.5 million units total and 11.7 million units retail, LMC Automotive is raising the light-vehicle sales forecast for the full year. The current forecast is now at 14.3 million units total light vehicles (up from 14.1 million units) and 11.5 million units retail light vehicles (up from 11.4 million units). An increase in fleet sales to 20 percent of total sales for the year is expected to outpace the increase in retail volume for 2012.

“Despite the lower selling rate in April, which was expected, we have raised our overall outlook for 2012 based on the high first quarter pace, improving economic variables and credit availability, as well as consumers replacing aging vehicles at a higher rate,” said Jeff Schuster, senior vice president of forecasting at LMC Automotive. “However, automotive sales remain vulnerable, as the market faces yet another potential shock due to a fuel and brake line resin shortage caused by a plant explosion in Germany in March.”

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Auto Sales Tracking at 14.68 Million Units, Reports CNW


BANDON – Based on the first 19 days of April, the auto industry is on track to sell 1.25 million units, 7.8 percent increase vs. a year ago, according to CNW Research. That would put the True Delivery Rate at 14.68 million units for the year.

The market research firm also noted a 13 percent increase in floor traffic from a year ago, which it attributed to consumers wanting to see new arrivals inside showrooms, reported F&I and Showroom magazine. That’s why closing ratios slowed somewhat, CNW said, but remained 5.5 percent ahead of last year.

“Same store” sales were also up by more than 7 percent, excluding stores closed for major remodels and stores in the process of moving or going out of business. But CNW’s Art Spinella noted that economic concerns among potential buyers continue to persist.

“The persistent problem of climbing concerns related to home-centric economics hasn’t diminished and, in fact, rose another 2.1 percent in the first half of April,” Spinella wrote in his monthly newsletter. “That has been somewhat offset by continued higher acceptance of subprime loan approvals, which are helping drive the market.”

The share of consumers with subprime credit visiting dealerships grew by 19 percent from last year’s 7.5 percent read, indicating that shoppers with poor credit are feeling more confident about their ability to acquire a new car or truck.

As for used, the days’ supply issue continues to plaque the segment, declining by another 1.3 percent vs. a year ago. “While a smaller gain than in the past few months, it is still an important metric and clearly responsible for the increased sales prices registered in the first 19 days of the month,” Spinella wrote.

Consumers who are buying new cars are increasingly willing to pay a bit more even though discounts dipped nearly 3 percent vs. March. The average MSRP of cars purchased rose 8 percent vs. year ago, and, compared to March, MSRPs are up 1.5 percent.

Core Transaction prices were also up by 5.6 percent to $31,216 vs. April 2011 and up 2.3 percent compared to March. But those increases have come at a price, Spinella noted.

Manufacturer incentives, including special loyalty programs, dealer/salesperson enticements and regional spiffs, rose by more than 35 percent compared to last year. Spinella, however, noted that the comparison is unfair given that last April’s incentive level dropped 33 percent vs. the previous April.

“Consumers want a new vehicle, but they’ll be pushed into it just so far,” wrote Spinella. “They’re willing to spend a bit more, but not as much as the MSRP price increases. That, in turn, means returning to incentives at both the manufacturer and dealer levels.

“For manufacturers, being able to hold their grosses and not bumping up incentives too drastically slipped through 2011 and the opening days of 2012,” Spinella added. “But competition and a smaller-than-expected pool of new-car buyers forced their hand. While smarter about which types of incentives to use and where to provide them, the overall cost is still up, and will probably be higher for the rest of this year.”

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Industry Sales Pace at 15 Million Annual Rate


A recent uptick in gas prices pushed consumers toward fuel-efficient vehicles rather than back to the sidelines, with the annual sales rate jumping to 15.1 million vehicles, according to Autodata. This was the best monthly showing since February 2008. Volkswagen led the way with a 42 percent sales surge year over year, followed by Chrysler’s 40 percent increase.

Audi: Audi of America reported 8,531 luxury vehicles sold in February, surpassing the prior February record set in 2011. The company’s year-over-year vehicle sales increased 10 percent while it’s year-to-date growth increased 14.9 percent compared to 2011. Three Audi models recorded year-over-year sales increases of 15 percent or more, including the Audi A3, Audi A6 and Audi TT models.

BMW/MINI: BMW Group reported February sales of 26,184 vehicles, a 31.5 percent increase from the 19,919 vehicles sold during the year-ago month. Sales of BMW brand vehicles increased 29.2 percent from a year ago to 21,204 in February. MINI USA reported sales of 4,980 units, an increase of 42.2 percent from the 3,503 sold in February 2011.

Chrysler: Chrysler Group LLC recorded its best February sales month since 2008 with 133,521 units sold, a 40 percent increase from February 2010. The Chrysler brand recorded a 114 percent year-over-year increase, while the FIAT brand finished its first year of sales with its best month ever. Sales of the Fiat 500 were up 69 percent compared to the previous month. Both the Jeep and Dodge brands posted year-over-year sales increases in February as well.

Ford: Ford Motor Company experienced a 14 percent increase in sales vs. the year-ago month, with 179,119 vehicles sold. Retail sales alone increased 19 percent. The Ford brand was up 14 percent, while Lincoln posted a 16 percent increase vs. a year ago. Ford’s F-Series posted a 26 percent increase, totaling 47,273 pickups. Focus sales totaled 23,350 units.

GM: General Motors Co. announced total sales of 209,306 vehicles in February, up 1.1 percent compared to a year ago. Year-over-year sales of the Chevrolet Silverado HD and GMC Sierra HD were up 28 percent and 20 percent, respectively. Other sales highlights for February include double-digit sales increases for the Buick LaCrosse, the Chevrolet Equinox and Camaro, and the GMC Terrain.

Honda/Acura: American Honda Motor Co. posted sales of 110,157 units, an increase of 7.8 percent vs. February 2011, based on the daily selling rate. The Honda Division posted February 2012 sales of 98,899, an increase of 8.8 percent year over year. The Acura Division’s February sales totaled 11,258, up 0.1 percent compared to February 2011, with the TL and TSX models registering strong sales increases.

Hyundai: Hyundai Motor America announced record February sales of 51,151 units, up 18 percent vs. 2011. Overall retail sales rose 29 percent year over year, while sales of the Sonata, Elantra and Accent increased by 11 percent, 12 percent and 29 percent, respectively. Combined sales of the Genesis and Equus models were up five percent over 2011 as well.

Mazda: Mazda North American Operations recorded its February sales month since 1994 with 25,651 units sold, representing an increase of 32.3 percent vs. last year. Mazda2 sales totaled 2,701, marking a 210.5 percent year-over-year increase, while Mazda3 sales totaled 11,275 vehicles for a 39.6 percent increase. Mazda 6 reported its best month since March 2008 with 5,101 vehicles sold, a 79.7 percent increase over 2011.

Mercedes-Benz: Mercedes-Benz USA reported February sales of 19,679 vehicles, a 21.7 percent improvement over February 2011 and the highest February volume on record. Sales for the month of February were led by the C-, E-, and M-Class model lines. The C-Class led the way with sales of 5,240, up 17 percent over February 2011. The E-Class came in right behind with sales of 4,206 and the M-Class rounded out the top three with sales of 3,408, up 77.1 percent compared to February 2011.

Nissan/Infiniti: Nissan North America Inc. posted February U.S. sales of 106,731 units vs. 92,370 units a year earlier, marking an increase of 15.5 percent. Nissan Division posted a record February with 97,492 sales, an increase of 17.1 percent over the old record of 83,226 units set in 2011. Infiniti delivered 9,239 vehicles in February, an increase of 1 percent vs. 9,144 units a year earlier.

Toyota: Toyota Motor Co. reported monthly sales of 159,423 units in February, a 7.9 percent year-over-year increase on a daily selling rate basis and 12.4 percent on an unadjusted raw volume basis. Led by sales of the Camry and Camry Hybrid and the Prius family, the Toyota Division recorded February sales of 142,745 units, an increase of 7 percent vs. the year ago month. The Lexus Division reported sales of 16,678 units, up 15.9 percent over last February.

Volkswagen: Volkswagen of America Inc. realized its best February since 1973 with 30,577 units sold. The company’s performance also represented a 42.5 percent increase vs. a year ago. Sales of the Passat totaled 8,189 units for the month of February, while the Jetta sedan remains the volume leader for Volkswagen with sales totaling 11,694 — its best February ever. The 2012 Beetle sold 1,303 units while the Tiguan sold 2,280 units.

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KBB Sees Auto Sales Pacing at 13.8 Million SAAR


IRVINE — Kelley Blue Book (KBB) said yesterday that it expects new-vehicle sales to surpass 1.05 million units this month, which means the industry would be pacing at a 13.8 million seasonally adjusted annualized rate (SAAR) — a 6.4 percent improvement from the year-ago period.

Bolstering the vehicle information site’s outlook are increased inventory levels, improved access to credit, attractive finance offers available to consumers and one additional selling day due to the leap year, officials said. New-vehicle sales have remained above 13.6 million SAAR since November 2011, but KBB said that it believes the annualized sales pace will slow after April, as pent-up demand is satisfied from Toyota and Honda’s inventory shortfalls.

“From a pure volume perspective, in the months ahead sales will continue to exceed last year’s figures, but there may be more volatility this year from month to month than in 2011,” said Alec Gutierrez, senior market analyst of automotive insights for KBB. “Sales were remarkably flat from May through November 2011, due to the production woes faced by Toyota and Honda. Now that they are producing vehicles at full capacity, a return to traditional seasonal patterns is likely through 2012.”

Consumers shopping in February and March will find an improved selection of vehicles available as a result of increased production in January, according to KBB. Manufacturers ramped up production in anticipation of President’s Day sales promotions and the onset of the spring selling season beginning in March.

As of Feb. 1, there were nearly 2.5 million vehicles available for sale on dealer lots — equivalent to a 66 days’ supply of vehicles overall, an improvement from the 52 days’ supply of vehicles available as of Jan. 1. The most significant inventory gains came from General Motors, Ford and Chrysler, each with greater than 80 days’ supply of vehicles available for consumers.

Touting a 50 days’ supply are Toyota, Honda and Nissan, while Hyundai and Kia only have a 30 days’ supply of vehicles overall, according to KBB. In the next month, car shoppers are expected to be able to negotiate savings by focusing on domestic vehicles, given the abundant supply currently available for sale. According to Autodata, domestic manufacturers spent more than $1,000 per unit more on incentives in January compared to their Japanese and Korean counterparts, a trend KBB expects will continue in February.

In terms of year-over-year growth, KBB said that it projects subcompacts to lead all other segments, especially with fuel prices surpassing $3.50 per gallon nationally.

“Although traditionally viewed as a budget segment reserved for those consumers willing to accept fewer amenities, cheaper materials and less than an awe-inspiring driving experience, today’s subcompacts compare favorably to many compacts or mid-size sedans,” said Gutierrez. “The Nissan Versa, Chevrolet Sonic, Ford Fiesta, Hyundai Accent, Honda Fit and Toyota Yaris all are excellent examples of either all-new or redesigned products that many consumers would be happy to call their own.”

The mid-size category was a strong performer in January, and KBB said that it anticipates February will be another solid month for the Camry-led segment. The Toyota Camry topped sales gains in January on the strength of its 2012 redesign.

Rising fuel prices and a slow economic recovery both stand as potential road blocks to continued improvements in new-vehicle sales, KBB noted. Oil prices closed at a nine-month high of nearly $105 on Feb. 20, while fuel prices have continued to climb for the past 60 days. Gas prices are up nearly 40 cents per gallon year-over-year and have increased steadily since late December. Although fuel prices remain high, current projections by the Energy Information Administration (EIA) place average fuel prices in 2012 only slightly above the highs experienced in 2011.

If conflict in Iran is avoidable, KBB said that it is hopeful that fuel prices will remain below the $4 highs of last year. In the worst case scenario, high fuel prices could slow the pace of the economic recovery and vehicle sales along with it.

The pace of the U.S. economic recovery remains very slow, and according to a recent forecast published by the Congressional Budget Office (CBO), the United States can expect much of the same through at least 2013. According to CBO estimates, the official unemployment rate, currently at 8.3 percent, will increase to 9.2 percent by the fourth quarter of 2013. In terms of overall economic output, Gross Domestic Product (GDP) is expected to show an annual increase of 2.2 percent in 2012, while 2013 will bring an even smaller 1.1 percent gain in GDP overall. Given the expectations for weak economic growth during the next several years, KBB said that it expects the pace of the new-vehicle sales recovery to slow.

Chrysler and Volkswagen Expected to Dominate Sales Gains in February

 

Sales Volume

Market Share

Manufacturer

Feb-12

Feb-11

YOY%

Feb-12

Feb-11

General Motors

195,000

207,028

-5.8%

18.5%

20.8%

Ford Motor Company

165,000

156,232

5.6%

15.6%

15.7%

Toyota Motor Corp.

147,000

141,846

3.6%

13.9%

14.3%

Chrysler Group

119,000

95,102

25.1%

11.3%

9.6%

American Honda

100,000

98,059

2.0%

9.5%

9.9%

Nissan North America

93,000

92,370

0.7%

8.8%

9.3%

Hyundai-Kia

88,000

76,339

15.3%

8.3%

7.7%

Volkswagen

40,000

29,315

36.4%

3.8%

3.0%

Total

1,056,000* 

993,535

6.3%

*Includes projections for manufacturers not shown

 

 

 


Subcompact Cars to Lead Sales Gains in February

 

Sales Volume

Market Share

Segment

Feb-12

Feb-11

YOY%

Feb-12

Mid-Size Cars

188,000

172,081

9.3%

17.8%

Compact Car

148,000

146,282

1.2%

14.0%

Compact Crossover

121,000

113,556

6.6%

11.5%

Full-Size Pickup Truck

118,000

109,677

7.6%

11.2%

Subcompact Car

63,000

48,714

29.3%

6.0%

Total

1,056,000* 

993,535

6.3%

*Includes projections for segments not shown

 

 

 

 

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Global Sales to Reach 77.7 Million Units in 2012, Polk Predicts


SOUTHFIELD — Polk announced it expects worldwide new-vehicle sales in 2012 to rise 6.7 percent over 2011 volumes to 77.7 million vehicles. The automotive market intelligence firm’s analysts believe the global economy will weather the current European sovereign debt crisis and consumers will return to showrooms this year.

The U.S. market will experience single-digit growth, primarily due to strong sales in 2011 and the effects of the weak economy that will continue to impact new-vehicle demand through most of 2012, according to Polk. Light-vehicle sales are expected to grow at a moderate pace — with a 7.3 percent increase in the region this year — to 13.7 million vehicles. Polk analysts do not expect the U.S. market to achieve pre-recession levels of greater than 16 million vehicles per year until 2015. They do, however, expect the luxury to be the fastest growing segment next year, predicting that it will grow by 14 percent, reported F&I and Showroom magazine.

“More affluent buyers are returning to the market for new vehicles after three years of spending reductions,” said Anthony Pratt, director of forecasting for the Americas at Polk. “The luxury segment also offers a wide variety of product options for consumers across all segments, ranging from small cars to SUVs.”

Leasing penetration will continue to be higher in the luxury segment in the U.S. and will continue to lift transactions in all segments. In 2011 leasing penetration reached pre-crisis levels (through October) of 41.5 percent for the luxury segment and 17.1 percent for the overall U.S. industry. This trend will likely continue through 2012, said analysts, as automakers will attempt to win back consumers with promotions touting attractive monthly payments.

China is expected to make the largest contribution to global sales growth for new vehicles with an anticipated 16 percent increase over 2011, according to Polk. The company’s analysts anticipate much of this growth to occur outside of Shanghai and Beijing.

European sales are expected to be flat or down slightly to just over 19 million units. “Austerity plans will prevent governments in Europe from boosting 2012 sales through scrappage programs and other incentives offered in previous years,” wrote Polk analysts.

Growth in Brazil, Russia, India and China will outpace many mature markets over the next few years. Polk expects Brazil to surpass Germany as 2011 sales results are finalized, and new-vehicle sales in India are expected to surpass those sold in Germany in 2014. Sales growth in Russia will likely be flat in 2012, but Polk anticipates sales in Russia to outpace Germany by the year 2015.

Polk predicts Toyota and Honda will realize the greatest amount of market share growth in 2012, as both begin to win back some lost share from their 2011 inventory shortages following natural disasters in Japan and Thailand. “They will likely struggle to regain all of their lost share, however, as they will experience strong competition from other automakers offering vehicles equipped with more fuel-efficient options and increased infotainment features,” analysts wrote.

Volkswagen will continue to win U.S. market share in 2012, approaching the 3 percent range, as the Beetle launch will build on the successful Passat and Jetta models, according to Polk.

Although Hyundai and Kia sales volumes continue to increase year over year, Polk expects their market share growth to be flat in 2012, as the companies face increased competition in all segments. General Motors, Ford and Chrysler will continue to grow in 2012 as the industry continues to recover. Refreshed products and new product introductions will help them to compete in various segments.

Polk’s complete light vehicle sales forecast (including passenger cars, light trucks and light commercial vehicles) through 2016 is as follows:

 

2012

2013

2014

2015

2016

Global

77.7

83.4

88.1

92.2

96.3

Europe

19.0

20.3

21.5

22.7

23.7

United States

13.7

14.9

15.6

16.0

16.3

Brazil

3.6

3.8

3.9

4.1

4.3

China

17.9

19.4

20.6

22.0

23.6

Japan

4.5

4.8

4.9

4.8

4.8

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New-Vehicle Sales Pacing at Three-Year High in November


WESTLAKE VILLAGE — New-vehicle retail sales are experiencing further recovery and strength through the first half of November, according to a monthly sales forecast developed by J.D. Power and Associates Power Information Network (PIN) and LMC Automotive.

November new-vehicle retail sales are projected to come in at 791,900 units, representing a seasonally adjusted annualized rate (SAAR) of 11.3 million units — the highest monthly selling rate in three and a half years, according to the report.

“Retail light-vehicle sales in November are outperforming expectations on a month-to-date basis, providing good news as 2011 comes to a close and the focus starts to shift to 2012,” said John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates. “The improving performance of the past three months suggests that the current momentum, primarily driven by replacement demand and improvements in vehicle availability, is not an aberration.”

Total light-vehicle sales in November are expected to come in at 975,600 units, an 8 percent increase year over year, according to the report. Fleet sales are expected to decrease by 6 percent compared with November 2010, but will account for 19 percent of total sales, according to F&I and Showroom magazine.

After a solid October and expectations for a strong November, LMC Automotive is increasing its forecast for 2011 to 12.7 million units (from 12.6 million units) for total light-vehicle sales and to 10.3 million units (from 10.2 million units) for retail light-vehicle sales. Additionally, LMC Automotive is maintaining its forecast for 2012 at 13.8 million units for total light-vehicle sales and 11.2 million units for retail light-vehicle sales.

“The upward forecast revision to 2011 represents the first increase to the forecast all year and tempers the cloud of uncertainty that has been over the automotive market for several months,” said Jeff Schuster, senior vice president of forecasting at LMC Automotive. “The current recovery pace appears sustainable into 2012. As long as there is not an external shock or economic setback, the selling rate could be stable above the 14 million-unit level during the second half of 2012.”

Light-vehicle production volume in North America has increased by 920,000 units, or 9 percent through the first 10 months of 2011 compared with the same period in 2010, according to LMC Automotive. The Detroit 3 OEMs are seeing nearly a 14 percent increase in year-to-date production through October, while European OEMs are up 38 percent.

Hyundai Group production is up 48 percent after increased production of existing models and additional localization of models in 2011, according to the report. Japanese manufacturers, as a group, posted an 8 percent decline year to date in October from the same period in 2010, which can be attributed the Japan earthquake disaster and flooding in Thailand.

The impact of the flooding is expected to continue through the fourth quarter, causing further downtime to their North American operations. Toyota is recovering faster than initially anticipated, with lost volume estimated to be 5,000 units in the fourth quarter. The impact to Honda is expected to be more severe due to the location of their Thai plants. Honda’s fourth-quarter loss in North America is estimated at 35,000 units.

Overall vehicle inventory improved to a 58-day supply at the beginning of November from 50 days at the beginning of October. Car inventory improved to a 53-day supply, up from 43 days in October, while truck levels are stable with a 62-day supply.

Several manufacturers continue to remain below the industry norm of a 60-day supply: Hyundai/Kia began November with 28 days’ supply, Honda was at 37 days’ supply and BMW was at 28 days’ supply, according to the report. Despite some setbacks, the 2011 North American production outlook remains on track for 12.9 million units, an increase of nearly 9 percent from 2010. While overall production volume in 2011 is the highest since 2007’s 15 million-unit level, it remains well below the mid-15 million level during the 2001-2006 time period.

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