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July Marks Fifth Month of 14.0-Million-Plus Sales Pace

July Marks Fifth Month of 14.0-Million-Plus Sales Pace

By Jeff Youngs, August 09, 2012
July was the fifth of seven months this year that ended with an average annual selling pace, or SAAR, above 14.0 million units, according to analysis of Power Information Network(R) (PIN) retail transaction data by J.D. Power with LMC Automotive.* Two fewer selling days in July this year (24) vs. last year's same month (26) meant that automakers sold 18% more new cars and light trucks in the U.S. market, which translated to a SAAR of 14.1 million units. Sales continue to be strong through the first seven months of 2012, and total light-vehicle sales are up 14% from a year ago. A few more highlights are summarized from a final July sales update by PIN and LMC Automotive:
  • In July, retail deliveries totaled nearly 970,000 units, which was up 17.8% from a year ago and up 6.8% from June's retail sales, when selling-day adjusted. This translated to a retail SAAR of 11.5M units, down nearly 500,000 units from last month, but up a significant 2.0 million units from a year ago.
  • Fleet sales climbed 19.4% from year-ago totals, but declined 21.7% from June on a selling-day-adjusted basis. July is traditionally a weak fleet sales month, and this month's performance resulted in the lowest mix of fleet sales this year, according to Dave Cutting, senior manager of North American forecasting at LMC Automotive. The fleet SAAR averaged 2.5 million units.
  • Analysis of PIN data from July reveals that the new-vehicle negotiated price in July dipped 1.3% from a year ago and also was down 0.8% from the price in June (not seasonally adjusted).
  • Also, the average cash rebate increased 12.2% from a year ago and was up 15.8% from June's average cash rebate.
  • In analyzing how deals were financed in July, lease sales penetration was down 0.6 percentage points and retail finance sales penetration increased by 1.4 percentage points from June.
  • Also in July, the average retail turn rate, which is the average number of days that a vehicle remained on a dealer lot until sold, was 51 days, which was up from 49 days in June, and 1 more day than last July.
  • At the segment level, all except for the Midsize Crossover (CUV) category posted year-over-year sales gains in July. Smaller vehicles continued to be in demand. The Sub-Compact Conventional (+41.3%); and Compact CUV (+27.3%) segments achieved year-over-year increases of more than 27%.
  • The Midsize Conventional (+28.6% from last July) segment accounted for one of every six new vehicles sold in July. The segment, which has the largest share of industry sales, captured more than a point of share to end July with 16.5% of industry sales vs. 15.15% a year ago. Another much smaller midsize vehicle segment, Midsize Vans (+30.6%), also reaped big gains from a year ago and improved its market share to 3.75% from 3.39% last July. The Midsize Van segment performance was fueled by strong sales of the Honda Odyssey (+104.5% from last July), Dodge Caravan (+54.5%), and the Chrysler Town & Country (+35.0%).
  • New model entries (such as the Chevrolet Sonic and Nissan Versa sub-compacts, and the Chevrolet Captiva and Mazda CX-5 compact CUVs) helped boost compact vehicle sales, and redesigned or updated models (such as the Kia Optima and Toyota Camry) helped boost market demand for cars. Also, stronger inventories from the Japanese automakers helped drive growth, LMC's Cutting points out.

*J.D. Power and Associates and LMC Automotive have a strategic alliance to share data and produce sales forecasts based on J.D. Power's real-time transaction data collected by PIN, with analysis and intelligence from LMC Automotive.

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