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August 2015 Sales May Dip Due to Labor Day Weekend Calendar Quirk

August 2015 Sales May Dip Due to Labor Day Weekend Calendar Quirk

By Philly Murtha, August 27, 2015

August is expected to continue to be a strong month for U.S. new-vehicle sales with end-of-model-year discounts and new model-year vehicles arriving in dealer showrooms. However, total and retail new-vehicle sales will be lower this month because traditionally robust Labor Day weekend sales will be added to September totals due to a quirk in this year’s sales calendar, according to a forecast update from J.D. Power and LMC Automotive.

It’s the first time since 2012 that deliveries that take place during the year’s biggest new-vehicle sales weekend will be tallied with September results rather than counted in August’s number. This year, the holiday falls on Monday, Sept. 7. A year ago, the Labor Day weekend accounted for 20% of August deliveries.

“On a year-over-year basis, August sales are going to appear weak, when in fact it’s really a variance in the numbers created by the calendar,” said John Humphrey, senior vice president of the global automotive practice at J.D. Power. He adds, “…the daily selling rate month-to-date in August is trending 8% higher than in the same period a year ago, although the absence of the holiday period in August sales will diminish that rate by month-end.”

Retail new-vehicle sales are projected to slip 1.2%, to 1.31 million units in August (adjusted for one less selling day*) vs. 1.38 million units in August 2014, based on data collected in the first 19 days of the month. Total (retail and fleet) deliveries in August 2015 are anticipated to edge down a slight 0.2%, to 1.52 million units vs. 1.58 million units a year ago. Fleet volume may offset some of the decline and account for a 13.8% share of the market.

On a positive note, Jeff Schuster, senior vice president of forecasting at LMC Automotive, said, “The current stock market volatility does not seem to be having much of a negative impact on consumers as the selling rate remains well above 17 million units.” He sees momentum in the U.S. auto market, “as it now looks unlikely there will be an interest rate increase in September, and a delay in rising rates will most certainly assist in keeping growth on track.”

*There are 26 selling days in August 2015 vs. 27 days in August 2014.

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