Find out about our products

Wednesday, August 13, 2014

For the automakers total sales year-to-date, Fiat Chrysler Automobiles reported a dip of 2% to 1.1 million vehicles compared with the first half of 2018. General Motors reported a 4.2% decline in total sales to 1.4 million vehicles sold.

Among other automakers reporting sales Tuesday, Nissan Group, which includes its luxury brand Infiniti, reported year-to-date sales down 8.2% to 717,036. Likewise, Toyota Motors North America, which includes Lexus, reported its sales through June down 3.1% to 1.15 million. Subaru reported its sales are up 5.2% to 339,525 through June. American Honda reported, through June, its sales dropped 1.4% to 776,995.

Automakers saw transaction prices on both cars and light trucks continue to rise and set records so far this year.

In fact, Ford said its transactions prices in the second-quarter were up for pickups and SUVs compared with the year-ago period. The average transaction price for an F-Series pickup was $47,500, up $1,200 from the year earlier.

According to the latest National Automobile Dealers Association Average Dealership Financial Profile Series from April 2019, the average new-vehicle transaction price was $36,642, up 3.3% compared with the year-ago period. Transaction prices on used vehicles sold by franchised dealers, on average, rose 3.8% to $20,979.

The average monthly payment gap between new and used vehicles continues to widen, which NADA said will likely push consumers to the used market.

Pickups and SUV sales remain a bright spot for automakers, said Tyson Jominy, vice president of data and analytics Consulting at J.D. Power. That, along with rising transaction prices, means more profitable sales even as volume declines.

Total automaker revenues are expected to be up over 1% compared with the prior year, largely driven by a 4% growth in average transaction prices, Jominy said.

But it's at the lowest end of the market where there is the "most dramatic story," Jominy said. Year-to-date, he said, sales for vehicles with transaction prices below $20,000 are off 21% after falling 19% in 2018. But for vehicles priced $30,000 to $50,000, sales are up 5% and those priced over $50,000, sales are up 9%.

GM believes the industry will sell a "healthy 17 million units" this year, said GM's Chief Economist Elaine Buckberg.

“The U.S. economy continues to grow at a healthy pace. Jobs are plentiful and inflation remains low,” said Buckberg. “Auto demand was better than anticipated in the first half and we expect strong performance in the second half of the year. If the Fed cuts rates, as widely expected, lower financing costs will provide further support to auto sales.”

Fewer new car sales
But Cox Automotive predicts carmakers will sell substantially fewer new cars for the year. It estimates auto sales will be 16.8 million new cars, down from the 17.3 million purchased last year amid unstable markets and political, economic and labor uncertainties.

NADA's Senior Economist Patrick Manzi also puts the annual retail sales estimate at 16.8 million, saying, "We remain confident, barring any unexpected shocks, that franchised dealerships are on track to sell 16.8 million new light vehicles in 2019. The downside risks to our sales forecast include the fallout from trade disputes, including potential tariffs on autos and auto parts, and the Fed changing course on interest rates."