DETROIT, Sept. 27, 2018 /PRNewswire/ -- New-vehicle retail sales in September are expected to fall from a year ago, according to a forecast developed jointly by J.D. Power and LMC Automotive. Retail sales are projected to reach 1,172,700 units, a 2.8% decrease compared with September 2017 on a selling day adjusted basis. (Note: September 2018 has one less selling day than September 2017).
"For the second consecutive year, storms have disrupted the pattern of new vehicle sales in September," said Thomas King, Senior Vice President of the Data and Analytics Division at J.D. Power."Sales in North and South Carolina through the first three weeks were down 12% due to Hurricane Florence. Conversely, while sales in the adjacent areas were up 19% vs. the Hurricane Irma-effected results of last year. Despite the storm, we expect some of the sales to be made up this month, and the remaining to be recovered in October."
Incentive spending in September is on pace to fall the for the third month in a row and marks the first time this year that spending on trucks/SUVs has fallen. September to-date spending was $3,910 per unit, down $152 from the same time last year. Spending on cars was down $371, while spending on trucks/SUVs was down $52.
"Reduced spending for the industry is partially a reflection of the reduced availability of low APR offers as interest rates rise," King said. "Finance deals with an APR of less than 1% have accounted for 5.3% of sales in September, down from 8.2% last year. However, as trucks/SUVs approach 70% mix of retail sales, any imbalances in inventory could place pressure on spending to rise in Q4." Trucks/SUVs have accounted for 69% of sales through month-to-date and are on pace to exceed 70% by October.
J.D. Power and LMC Automotive U.S. Sales and SAAR Comparisons
New-Vehicle Retail Sales
(-2.8% lower than September 2017)2
Total Vehicle Sales
(-2.2% lower than September 2017)2
14.5 million units
13.1 million units
15.2 million units
17.4 million units
16.6 million units
18.1 million units
Figures cited for September 2018 are forecasted based on the first 18 selling days of the month.
September 2018 has 25 selling days, while September 2017 had 26 selling days in the month.
Jeff Schuster, President, Americas Operations and Global Vehicle Forecasts at LMC Automotive, said, "While the auto industry has exhibited mixed health signals, there have been some improvements in recent weeks and vehicle sales have quietly maintained a solid pace. Trade and rising interest rate risk remain real factors in the background, clouding investment decisions and potential future consumer purchases."
LMC's forecast for 2018 total light-vehicle sales remains at 17.2 million units, an increase of just 0.1% from 2017. The retail light-vehicle forecast remains at 13.8 million units, a decline of 1.3% from 2017. Fleet volume is expected to rise by 6.1% and account for 20% of total light-vehicle sales.
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SOURCE J.D. Power