U.S. Auto Sales in April Set to Reach Highest Level in a Decade
By Philly Murtha, April 26, 2015
U.S. new-vehicle retail sales in April are expected to increase 5% from a year ago and reach the highest totals for any April since 2005, mainly due to a spate of new and redesigned models and lower gasoline prices, according to a monthly sales forecast update from J.D. Power and LMC Automotive.
Based on analysis for the first 16 days of April, total new-car and light-truck sales (including retail and fleet deliveries) are projected to hit 1.463 million units--5% above last April's total (1.388 million unit sales) and the highest total since 1.5 million units were sold in April 2005. Fleet sales likely will make up a 19.4% share of total sales in April.
It's estimated that total light vehicles are being sold at a seasonally adjusted annual rate (SAAR) of 16.6 million units, up about 600,000 units from a 16.0 million-unit selling pace in April 2014.
Retail sales (excluding fleet) also are likely to climb 5%, to 1.179 million units from 1.120 million units sold in April 2014. The retail SAAR is estimated to average a 13.7 million-unit pace--400,000 units stronger than a 13.3-million-unit pace in April 2014. Retail sales in April 2005 were 1.190 million units. Retail deliveries are considered the most accurate reflection of true consumer demand for new cars and trucks.
John Humphrey, J.D. Power senior vice president of the global automotive practice, observed that the industry continues to outperform year-ago retail sales levels. Also, the Power Information Network(R) (PIN) from J.D. Power finds that the average new-vehicle transaction price in April is $30,680, which could set a new record for the month, which currently sits at $29,948, set in 2014.
Higher transaction prices could be related to the increase in model introductions in the U.S. auto market this year. "Overall, auto sales remain strong, a trend that is sustainable throughout 2015 due to consumer demand that is being fueled by 50 new or redesigned models in showrooms this year," adds Jeff Schuster, senior vice president of forecasting at LMC Automotive.
While lower gasoline prices may be contributing to higher overall sales, they also appear to be putting pressure on car segments, while truck sales surge, according to the update. Through mid-April, light trucks grabbed a 56% share of industry retail sales--up 4.5 percentage points from a year ago. This is the first time truck sales have surpassed 55% in the month of April since 2004.