October Retail Light-Vehicle Sales Remain Relatively Strong

Jeff Schuster

Despite continuing concern about the state of the US economy, retail light-vehicle sales during the first half of October remained relatively healthy, and are in line with the average selling pace achieved at the beginning of this year. In October, J.D. Power projects that the average annual selling pace (SAAR) for retail light-vehicles will reach 10.5 million units, which matches last October’s rate and the average sales pace in September 2011.

Highlights from our most recent monthly sales update that is based on Power Information Network® (PIN) retail transaction data for the first 13 selling days of the month include an outlook for retail, fleet and total US sales in October and for the calendar year:

• Retail light-vehicle sales in October are expected to reach 828,300 units, up 11% on a selling-day-adjusted basis* from 776,839 unit sales in October a year ago. This equates to a selling pace of 10.5 million units, which matches last October’s retail sales pace and also the sales rate in September 2011.

• Fleet deliveries are also anticipated to increase 11% from the same month in 2010, and are projected to account for 19% of total industry sales.

• Total sales (retail and fleet) will surpass 1 million units in October, and again rise 11% from October 2010, when adjusted for one less selling day this year.

• October’s total sales pace is predicted to be 13.1 million units, which would be higher than 12.2 million units in October 2010, and the same pace as in September 2011.

• Our PIN data indicates that most major segments are expected to post year-over-year sales gains. Compact and Midsize Crossover (CUV) segments continue to outpace industry gains. In addition, the industry’s average retail turn rate** in mid October was one day shorter than last month’s 45-day turn rate.

• J.D. Power is keeping its calendar-year forecast for 2011 at 12.6 million units for total light-vehicle sales, and 10.2 million units for retail light-vehicle sales. However, J.D. Power is lowering its sales outlook for 2012 to 13.8 million units for total light-vehicle sales (from 14.1 million units), and reducing the retail sales projection to 11.2 million units from 11.5 million units.

While there have been some encouraging positive signs in the US economy, the recovery pace for 2012 is taking another hit, although we do not expect growth to completely stop.Jeff Schuster, executive director of global forecasting at J.D. Power and Associates 

*The percentage of change in sales is adjusted since there are 26 selling days in October 2011 and 27 days in October 2010.

**The retail turn rate is the average number of days that a vehicle remains on a retailer’s lot before being sold.

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