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Commentary & Voices

November 2018 U.S. Automotive Sales

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Auto sales in November 2018 continued at a healthy pace. Full-year 2018 sales are on course to beat 2017 and pass the 17-million milestone for the fourth straight year, a record streak.

While General Motors did not make November sales public, the Cox Automotive team is estimating the company delivered sales better than our initial forecast of 235,000 vehicles, a year-over-year decline of 4.2 percent. With other OEMs reporting, we now believe GM sales were likely flat or slightly higher than 2017, in the range of 245,000.

Please find below commentary and notable highlights from the team at Cox Automotive. If you would like to speak with one of the expert analysts from Autotrader, Kelley Blue Book or any member of the Cox Automotive Industry Insights team, please contact us.

From Jonathan Smoke, Chief Economist, Cox Automotive:
The U.S economy remains fairly stable and that’s helping sustain strong auto sales. Consumers continue to spend, which is supporting economic growth. Low unemployment is driving wage increases. Consumer confidence, while down a bit in November, remains very strong. Higher interest rates are already negatively impacting sentiment about buying vehicles and homes, and the pace of home sales continues to soften. We haven’t seen the same declines in vehicle sales yet, which is why November’s auto sales pace remains healthy.

From Charlie Chesbrough, Senior Economist, Cox Automotive:
Light vehicle sales in November beat our initial forecast, with surprisingly robust demand for CUVs and trucks keeping the market strong. Worsening buying conditions from higher prices and higher interest rates don’t appear to be keeping buyers away; heavy incentives in November likely helped and drove strong end-of-month sales. Our data shows Black Friday was a busy one at dealerships across the country. The sales pace, which shifted into a higher gear in September, remains on an elevated level. Given the success of recent months, 2018 is more than likely to finish higher than last year – the fourth straight year with sales above 17 million, a record winning streak.

From Akshay Anand, Executive Analyst, Kelley Blue Book:
Early indications are that it was business as usual in November for luxury, with SUV sales carrying several brands. December should be a very strong month as well, as luxury brands traditionally push marketing hard to close out the year and several compete for the luxury sales crown. Healthy luxury sales should continue into 2019, as a slew of new luxury SUVs will hit the market over the course of the year.

From Michelle Krebs, Executive Analyst, Autotrader:
Ford outperformed expectations thanks largely to the automaker turning on the spigot of holiday spiffs. The incentives ran the gamut of zero percent for 36 to 72 months, cash help for subprime consumers, cash for owners of competitive models and employee pricing for victims of wildfires and hurricanes. The incentives cut across all model lines, though specific trim levels and equipment packages, applied in many cases, and they were strategic in geographic targeting. Rich deals are likely to continue as Ford closes out the year.

From Karl Brauer, Executive Publisher, Autotrader and Kelley Blue Book:
The market continues to abandon cars, with no end in sight. Automakers have slowed or stopped production and buyers are mostly looking at trucks and SUVs. A few models have somewhat stabilized in recent months, but generally speaking cars — and brands that depend heavily on cars — don’t have a good story to tell. Every time we think we’ve hit the bottom in car market share another month passes with trucks and SUVs gaining while cars lose. This is the reality that recently drove Ford and GM to announce plans to further reduce car production. Who can blame them?

From Brad Korner, General Manager, Cox Automotive Rates and Incentives:
The industry was showing restraint and discipline with incentives through the summer and early fall, but that changed in November. Inventories have been inching upwards, particularly on trucks and SUVs, so many makers got aggressive last month with Black Friday deals, special APR incentives, and conquest money. Many manufacturers are aggressively pursuing “Employee Pricing For All” deals in select markets. We’re also moving into auto show season, when many automakers offer special incentives as shows open in cities across the country. All this adds up to better deals in the market. As 2018 winds down, automaker motivation is spinning up.

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