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Cox Automotive Forecast: U.S. Auto Sales Pace Expected To Fall For Third Straight Month

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Article Highlights

  1. Annual sales pace expected to fall to 16.5 million in August, down from July’s 16.8 million level.
  2. August sales volume is expected to rise 6.5%, but seasonal adjustments reduce the sales pace.
  3. Slower sales pace aligns with Cox Automotive’s full-year forecast of 16.8 million new-vehicle sales.

ATLANTA, Aug. 28, 2019 – Cox Automotive is forecasting U.S. new-vehicle sales volume in August to finish at 1.59 million, up 6.5% from last year, or an increase of nearly 100,000 units. The seasonally adjusted annual rate (SAAR), however, is expected to drop to 16.5 million, below July’s 16.8 million level, and down from August 2018’s strong pace of 16.9 million.

Charlie Chesbrough, senior economist with Cox Automotive, suggests a trend may be emerging: “Unfortunately, the third time is not a charm here. Compared to May 2019, which had the highest SAAR this year, August is forecast to be the third month in a row with a slowing sales pace. The market may finally be succumbing to toughening buying conditions and satiated vehicle demand.”

Although the pace is likely to decline, sales volume in August is forecast to be higher than last year. August 2019 has 28 selling days, one more than last August, which causes the SAAR to fall even though sales volume rises. In addition, Labor Day weekend, an important selling period, falls within the August reporting period this year and not September as it did last year. With the shift, comparing annual differences will be difficult. A better comparison will be combined August and September sales this year versus last year, eliminating the Labor Day weekend issue.

August 2019 Sales Forecast Highlights

  • In August, new light-vehicle sales, including fleet, are forecast to reach 1.59 million units, up 6.5%— nearly 100,000 units—from August 2018. Versus July 2019, sales are expected to increase nearly 200,000 units, almost 14%, but there are three additional selling days so a large gain is expected.
  • The SAAR in August 2019 is forecast to be 16.5 million, down from last month’s 16.8 million level and down from last year’s 16.9 million pace. The additional sales days in August 2019 are contributing to the relatively weak SAAR forecast, given an increase in sales volume.
  • Record volume for August occurred in 2002 when sales reached 1.7 million vehicles and a SAAR of 18.1 million. It is unlikely that record is broken this month, however, another record could be achieved. The sales pace for cars fell to 4.6 million last month, the slowest pace since the depths of the great recession. In fact, of the 10 slowest months for passenger car sales over the last 43 years, six have occurred in 2019 – the other four were all during the 2009 downturn. The shift to crossovers from passenger cars in recent years has been dramatic and is likely the new normal.

August 2019 Forecast

Sales Forecast1 Market Share
  Aug-19 Aug-18 Jul-19 YOY% MOM% Aug-19 Jul-19 MOM
GM 275,000 239,757 235,000* 14.7% 16.9% 17.3% 16.8% 0.5%
Ford Motor Co 205,000 217,700 193,000* -5.8% 6.4% 12.9% 13.8% -0.9%
Toyota Motor Co 235,000 223,055 209,204 5.4% 12.3% 14.8% 15.0% -0.2%
FCA Group 205,000 193,718 172,000* 5.8% 19.3% 12.9% 12.3% 0.6%
American Honda 160,000 147,903 141,296 8.2% 13.2% 10.1% 10.1% -0.1%
Nissan NA 120,000 112,376 98,880 6.8% 21.4% 7.5% 7.1% 0.5%
Hyundai Kia 125,000 111,406 112,331 12.2% 11.3% 7.9% 8.0% -0.2%
VW 62,000 57,245 55,514 8.3% 11.7% 3.9% 4.0% -0.1%  
Subaru 70,000 64,088 64,106 9.2% 9.2% 4.4% 4.6% -0.2%
Grand Total2 1,592,000 1,495,054 1,398,713 6.5% 13.8%      
1 August 2019 Cox Automotive Industry Insights Forecast; all historical data from OEM sales announcements
* GM, Ford, FCA monthly sales are estimated
2 Total includes brands not shown
Sales Forecast1 Market Share
Segment Aug-19 Aug-18 Jul-19 YOY% MOM% Aug-19 Jul-19 MOM
Mid-Size Car 125,000 121,972 104,155 2.5% 20.0% 7.9% 7.4% 0.4%
Compact Car 150,000 143,524 129,488 4.5% 15.8% 9.4% 9.3% 0.2%
Compact SUV/Crossover 290,000 277,072 254,539 4.7% 13.9% 18.2% 18.2% 0.0%
Full-Size Pickup Truck 230,000 207,088 202,813 11.1% 13.4% 14.4% 14.5% -0.1%
Mid-Size SUV/Crossover 250,000 227,598 225,205 9.8% 11.0% 15.7% 16.1% -0.4%
Grand Total2 1,592,000 1,495,054 1,398,713 6.5% 13.8%      
1 Cox Automotive Industry Insights data
2 Total includes segments not shown

Overall, strong consumer confidence and employment gains continue to provide stable demand for light vehicles; however, both measures are showing some weakness. Job creation has slowed since last year and consumer confidence, while still elevated, is down from earlier in the year.Affordability issues are weighing on the new-car market as rising vehicle prices and elevated interest rates keep monthly payments out of reach for many potential buyers.

“One of the key questions for the vehicle market today is whether all the recession talk in recent weeks has scared off potential buyers,” notes Chesbrough. “If one is expecting the economy to worsen, taking on a $500 monthly payment in the family budget, and committing to it for years, becomes much less desirable.”

All percentages are based on raw volume, not daily selling rate.

About Cox Automotive

Cox Automotive Inc. makes buying, selling, owning and using cars easier for everyone. The global company’s 34,000-plus team members and family of brands, including Autotrader®, Clutch Technologies, Dealer.com®, Dealertrack®, Kelley Blue Book®, Manheim®, NextGear Capital®, VinSolutions®, vAuto® and Xtime®, are passionate about helping millions of car shoppers, 40,000 auto dealer clients across five countries and many others throughout the automotive industry thrive for generations to come. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately-owned, Atlanta-based company with revenues exceeding $20 billion. www.coxautoinc.com

Media Contacts:
Mark Schirmer
734 883 6346
mark.schirmer@coxautoinc.com

Dara Hailes
470 658 0656
dara.hailes@coxautoinc.com

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