U.S. Auto Sales Climb in November as Total Pace Surpasses 16 Million Units

John Humphrey

John Humphrey

Through the first half of November 2013, sales returned to a stronger pace than in September and October—which were hampered by negative external factors, including the U.S. government shutdown in October and the pull forward of Labor Day sales with two less selling days in September—according to an auto sales forecast update from J.D. Power and strategic partner LMC Automotive.

Retail new-vehicle deliveries in November are expected to reach 1.03 million units—up 4% from November 2012 on a selling-day adjusted basis*. This figure translates to a 13.0 million-unit seasonally adjusted annual selling rate (SAAR), which is higher than the year-to-date level of 12.8 million units.

Fleet sales on a selling-day adjusted basis are expected to account for 16% of the sales mix in November, which is 3% lower than a year ago and consistent with the low fleet share that has held throughout 2013. Continue reading ›

J.D. Power’s King Discusses U.S. Auto Market Shifts at Joint Conference

Thomas King Speaking at S&P ConferenceJ.D. Power’s Thomas King, senior director, Power Information Network® (PIN), recently shared insights on changes in new-vehicle demand in the U.S. market at the Standard & Poor’s/J.D. Power Auto Industry Hot Topics Conference in New York.

Analysts from S&P, J.D. Power, and strategic partner LMC Automotive, presented their views and analysis of the current and future state of the U.S. and global auto industry to an audience of more than 160 Wall Street analysts and reporters. Continue reading ›

Large Pickup Demand Spurs May U.S. Light-Vehicle Deliveries

2012 WAC Humphrey-27-M

John Humphrey provide an auto industry outlook during a J.D. Power International Automotive Roundtable conference.

Demand for large pickups helped drive sales ahead in the first 16 selling days of May, according to a monthly sales forecast update from J.D. Power’s Power Information Network® (PIN) and strategic forecasting partner LMC Automotive.

Through the first half of the month, large trucks account for 11.4% of the industry’s retail sales, which is nearly 10% stronger than a year ago and up from an already robust 11% share of retail sales in April 2013. A year ago, large pickups comprised only 9.7% of the industry’s retail sales mix.

Higher sales of these full-size pickups also is helping to keep the industry’s average transaction prices at record levels. The average transaction price for all new vehicles to date in May is $28,921, the highest ever for any month of May and 3% higher than May 2012, based on our PIN data. Continue reading ›

The New Year Begins with Stronger-than-Expected U.S. Auto Sales

1Salesperson and Couple at DealershipJanuary new-vehicle sales in the U.S. market were stronger than expected. Sales climbed nearly 10% due to consumers continuing to trade in their current vehicles (vehicle age in the United States averages 11 years) for new ones or replacing vehicles damaged or totaled during last October’s East Coast Sandy superstorm.

Easier credit and discounts in some segments also made new-vehicle purchases and leases more viable in January. Compacts were still popular, partly due to gas prices beginning to rise again*, and there appears to be a revival in the light-truck segment due to the start of a comeback in the housing industry.

Detroit Three Achieve Double-Digit Sales Gains

It was a good month for Michigan. All three Detroit-based manufacturers—Fiat-Chrysler Group, Ford Motor Co., and General Motors Co.—reported that new-vehicle sales were up in double digits from January 2012. Continue reading ›

January’s Strong U.S. Retail Sales Pace Adds Clout to 2013 Auto Forecast

HumphreyJ

John Humphrey

Retail new-vehicle sales in the U.S. market were robust in the first half of January, averaging a seasonally adjusted annual rate (SAAR) of 12.9 million units, which would be the highest retail pace in the month in five years and some 2.0 million units stronger than in January 2011, according to a sales update created by J.D. Power’s Power Information Network® (PIN) and LMC Automotive.

The retail sales pace, which outperforms the calendar-year forecast of 12.4 million units for 2013, seems to build on the recovery of the industry during the past two years and remains on a path to return to near pre-recession levels within the next few years. Retail sales should reach 812,600 units, which is significantly ahead of 682,171 unit sales in January 2011.

Total light-vehicle sales, which include retail and fleets, are projected to surpass 1.027 million units—up 8% on a selling-day-adjusted basis from January 2012. The fleet share is likely to account for 21% of deliveries, which is lower than 25% in 2012. This sales forecast translates to a 15.0 million-unit pace, up from 13.9 million units in January 2012. Continue reading ›

China’s Automakers Eye India for Future Growth

Ammar Master

Ammar Master

The rapid emergence of India as a major automotive powerhouse coupled with the ambitions of China’s automakers to go global are the principal drivers behind the planned entry of China’s big automakers Beiqi Foton and Great Wall Motor.

Foton aims to become a key global player over the next decade, according to its 2020 Strategy statement. Under the truck maker’s “5+3+1” strategy, India is a key region in its growth plan along with Brazil, Mexico, Russia and Indonesia.

This is why Foton signed a Memorandum of Understanding (MoU) with the Maharashtra government in India last April to establish a manufacturing unit at an investment cost of $307 million over 5 years. It is currently in the process of setting up its plant in Chakan (near Pune) to build light-, medium- and heavy-duty commercial vehicles. Continue reading ›

Demand for Replacement Vehicles Spurs December U.S. Auto Sales

Car buyer gets keys from DealerDecember nearly always is a strong sales month in the auto industry, and this past year’s 12th month auto sales results were no exception. Consumers in the United States continued to replace their aging vehicles at a faster pace than in the previous year.

The month’s light-vehicle deliveries rose 13.3% from a year ago to 1.353 million units, which translates to a 15.2 million-unit seasonally adjusted annual selling rate (SAAR), nearly matching an earlier forecast from our Power Information Network® (PIN) and strategic partner LMC Automotive. Sales in December were also boosted by consumers replacing vehicles totaled or damaged in late October’s Hurricane Sandy super storm on the East Coast.

Two German Automakers Post Leading Sales Gains in December

December also remained a strong month for luxury deliveries, as anticipated in earlier J.D. Power analysis. Two European automakers, Volkswagen and BMW Groups, sold nearly 40% more new vehicles than they delivered in December a year ago. Volkswagen Group’s Audi and Porsche luxury brands posted stellar sales in December and for calendar 2012. Porsche’s sales rose by more than 60% from a year ago. In addition, the mass-market VW brand was helped by strong sales of newer models such as the U.S.-made Passat and the Jetta. Continue reading ›

Small-Vehicle Demand Bolsters September U.S. Sales

Consumers continued to replace their aging cars and trucks with more fuel-efficient new models in September—especially since higher gasoline prices* helped prime demand for sub-compact or compact new vehicles with smaller engines and even alternative powertrains, in particular hybrids. In addition, discounts on outgoing 2012 models plus excitement about new and redesigned models helped boost sales by nearly 13% from the same month last year.**

Total U.S. new-vehicle sales in September reached 1.187 million units, which translated to a relatively strong 14.9 million-unit seasonally adjusted selling rate (SAAR), according to J.D. Power’s Power Information Network® (PIN) and strategic partner LMC Automotive. September’s sales pace was significantly stronger than last year’s 13.1 million-unit SAAR. Continue reading ›

Lower Customer Sales Satisfaction in China Impacted by Higher Inventories and Dealership Sales Staff Turnover

 

Dr. Mei Songlin

China’s recent market slowdown has led to higher passenger-vehicle inventories at dealerships, creating an atmosphere in which dealership personnel feel pressured to make sales quickly. In addition, the rapid expansion in the number of dealerships in China has led to a high employee turnover rate, leading to a dearth of experienced sales people.

This confluence of events appears to have negatively impacted overall customer satisfaction with the new-vehicle purchase experience, according to our 2012 China Sales Satisfaction Index (SSI) Study.

In our latest China SSI Study, overall sales satisfaction falls 6 index points from 2011 to an average 841 (on a 1,000-point scale), with the most significant declines among the seven categories evaluated being the salesperson, sales initiation process and delivery process. Continue reading ›

Transaction Prices Rise Long-Term, but Remain Stable in the Short-Term

Thomas King

Recently, Thomas King, senior director of our Power Information Network® (PIN), looked at current trends in retail transaction prices for the auto industry based on PIN real-time data and analysis. A few questions that he considered from media requests and his responses are highlighted:

Q: Are average transaction prices for the industry increasing?

TK: From a long-term perspective, yes, industry transaction prices have risen by a large amount. In 2008, the average transaction price for a new retail vehicle sale was $25,505 and by 2011 that had risen to $28,337. That’s a difference of $2,832, or slightly more than 11%.

Q: Why have transaction prices risen over the long term?

TK: Better alignment between supply and demand means that OEMs are selling a richer mix of vehicles with lower incentives. It should be noted, however, that the decline in incentive spending only partially explains the rise in transaction prices. In 2008, average incentive spending per unit was $3,018, but by 2011 it had fallen by $332 to an average $2,686. The balance of the increase in transaction prices is due to stronger new-vehicle pricing and a richer mix of vehicles being sold (vehicles with more features and equipment). Continue reading ›