DETROIT, Nov. 26, 2018 /PRNewswire/ -- New-vehicle retail sales in November 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 1,096,500 units, a 3.8% decrease compared with November 2017 on a selling day adjusted basis.
"While the continued decline in retail sales is disappointing, record transaction prices remain an encouraging indicator for the long-term health of the industry," said Thomas King, Senior Vice President of the Data and Analytics Division at J.D. Power.The average transaction price in November is on pace to reach $33,697, the highest level ever recorded. The record prices reflect higher prices trending for both cars (up 4% to $27,407) and trucks/SUVs (up 1% to $36,123), coupled with the ongoing shift in sales from cars to trucks. So far this month, trucks/SUVs account for 71.2% of retail sales, compared with 66.6% in November 2017.
Incentive spending also is on pace to decline on a year-over-year basis for the fifth consecutive month. November to-date spending is $3,783 per unit, down $285 from the same time last year. Spending on cars is down $784, while spending on trucks/SUVs is down $48.
"Strong transaction prices and lower incentives are helping maintain manufacturer profitability despite the decline in sales," King said.
Thanksgiving weekend is one of the busiest selling periods of the year and is expected to account for nearly 20% of November sales. The long weekend also coincides with the launch of incremental incentives tied to year-end sales events, which present manufacturers with the challenge of maintaining incentive discipline exhibited over the past five months. All indications are that incentive spending will remain below year-ago levels, although in absolute terms, incentives remain high. "With average discounts equal to 9.6% of MSRP in November, consumers still have plenty of opportunity to purchase a new vehicle at a significant discount," King said.
J.D. Power and LMC Automotive U.S. Sales and SAAR Comparisons
New-Vehicle Retail Sales
(-3.8% lower than November 2017)2
Total Vehicle Sales
(-2.5% lower than November 2017)2
13.2 million units
13.6 million units
13.7 million units
17.2 million units
17.6 million units
17.6 million units
1Figures cited for November 2018 are forecasted based on the first 15 selling days of the month.
2November 2018 has 25 selling days and November 2017 had 25 selling days.
Jeff Schuster, President, Americas Operations and Global Vehicle Forecasts at LMC Automotive, said, "Volume for the year is holding consistent with 2017 but, as the industry plans for a prolonged and significant investment period in future mobility without a return, cutbacks are being made that could affect near-term planning and future programs. Next year will bring a new challenge for the industry and some familiar ones like trade and rising interest rates."
LMC's forecast for 2018 total light-vehicle sales remains at 17.2 million units, but has slipped to just 22,000 units higher than 2017. The retail light-vehicle forecast remains at 13.8 million units, a decline of 1.0% from 2017. Fleet volume remains the growth engine with volume expected to be 5% higher and representing 20% of total light-vehicle sales. For 2019, the forecast for total light-vehicles is at 17.0 million units and retail light-vehicle sales is at 13.7 million units, each declining 1.3% from 2018.
About J.D. Power and Advertising/Promotional Ruleswww.jdpower.com/business/about-us/press-release-info
About LMC Automotivewww.lmc-auto.com.
No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power or LMC Automotive. www.jdpower.com/business www.lmc-auto.com
View original content to download multimedia:http://www.prnewswire.com/news-releases/new-vehicle-retail-sales-in-november-to-fall-transaction-price-to-reach-highest-level-ever-300754466.html
SOURCE J.D. Power