September New Light-Vehicle Sales Up 5% Year-over-Year
By Jeff Youngs, September 25, 2014
Sales of new light vehicles in the United States continue to grow, year over year, with new light-vehicle retail sales in September now projected to rise by 6% over September 2013 on a selling-day-adjusted basis. This, according to a monthly sales forecast developed jointly by J.D. Power and LMC Automotive, will amount to more than one million units sold at retail in September 2014--an increase of 94,000 units over the previous year.
The retail seasonally adjusted annualized rate (SAAR) in September is expected to be 13.5 million units--an increase of 1.2 million units over September 2013--marking the seventh consecutive month in which the SAAR has exceeded 13 million units. Retail transactions are the most accurate measure of true underlying consumer demand for new vehicles. The projected SAAR for total light-vehicle sales (including fleet vehicles, etc.) is 16.5 million units in September 2014, compared with 15.4 million in September 2013.
J.D. Power expects consumer spending on new vehicles (retail sales multiplied by the average transaction price) to exceed $30 billion in September--the highest level for the month of September since 2004. The projection for September is somewhat lower than the exceptionally strong August number--1,378,588 units sold at retail--but still strong for September, when sales typically slow down.
"Vehicle sales typically fall sharply immediately following the Labor Day holiday before recovering later in the month, but the decline this September has been smaller than in prior years," said John Humphrey, senior vice president of the global automotive practice at J.D. Power. "While the strong sales pace is an indicator of the health of the industry, it is being complemented by record transaction prices for the month of September."
The average new-vehicle retail transaction price in September is projected to hit $30,100, the highest ever for the month and exceeding September 2013 by nearly $450.
Total sales of light vehicles in September 2014 (including fleet sales) are projected to reach 1.25 million units--an increase of 5% over September 2013 on a selling-day-adjusted basis.
LMC Automotive has increased its 2014 U.S. new-vehicle retail sales forecast to 13.6 million units from its previous expectations of 13.5 million and has bumped its total light-vehicle sales forecast to 16.4 million units from 16.3 million. LMC also expects North American production to reach 16.8 million units in 2014--an increase of 4% from 2013. Its prediction for 2015 is 17.1 million units--the first time North American production will surpass 17 million units since 2000.
"The strength in automotive sales is undeniable, as August sales performance was well above expectations and there is no evidence of a payback in September, suggesting that the auto recovery still has some legs," said Jeff Schuster, senior vice president of forecasting at LMC Automotive. "On the heels of another increase in the 2014 expected volume, 2015 is expected to hit 16.7 million units with more upside potential than downside risk."