Cox Automotive Forecast: U.S. Auto Sales Continue V-Shaped Recovery in Third Quarter
Monday September 28, 2020
- Annual vehicle sales pace in September is expected finish near 15.5 million, the fifth consecutive month of improvement.
- Sales volume in September is expected to be near 1.275 million units, nearly equal to year-ago levels.
- New-vehicle inventory levels continue to slip lower, with only 3% of available inventory being model year 2021, far below normal levels.
ATLANTA, Sept. 28, 2020 – Auto sales in the U.S. are forecast to continue their COVID-19 recovery in September as the new-vehicle sales pace should increase over last month. The seasonally adjusted annual rate (SAAR) is likely to reach 15.5 million, a modest improvement over August’s 15.2 million, and the fifth consecutive month of sales pace improvement after April’s historic low, according to a forecast released today by Cox Automotive.
Sales volume is expected to be down just 0.3% compared to year-ago levels; however, September 2020 had two additional selling days and a Labor Day weekend compared to September 2019, so a relatively strong year-over-year volume comparison was expected.
New-vehicle sales are performing well, considering the historically low inventory levels. According to Charlie Chesbrough, senior economist at Cox Automotive: “Available Inventory is far below last year’s levels, yet sales continue to show surprising strength. Going into the fourth quarter, the key question is: Can this continue? Clearly new vehicle buyers haven’t been hit as hard as other consumers during this recession, so demand is likely to remain stable over the near-term.”
Closing out the third quarter, year-to-date U.S. auto sales volume is forecast to be down 19.6%. Retail sales are holding up relatively well compared to lease; fleet activity – rental, commercial and government – remains depressed.
One potential issue for the fourth quarter is lack of new product due to the model year roll-over delay. There are only a handful of model year 2021 vehicles in the marketplace right now, and vehicle buyers may be surprised when they go shopping this fall for the latest and greatest products. Currently, only 3% of available inventory is model year 2021. At this point last year, 25% of dealer supply was model year 2020. Factory shutdowns have delayed many products and limited availability of others. This headwind is likely to increase through at least the remainder of the year.
September 2020 Sales Forecast Highlights
- New light-vehicle sales are forecast to fall to 1.275 million units, down 0.3% compared to September 2019. When compared to last month, sales are expected to decrease by 50,000 units, or nearly 3.7%.
- The SAAR in September 2020 is estimated to be 15.5 million, far below last year’s 17.1 million level, but an improvement from last month’s 15.2 million sales pace.
- All segments are expected to have lower month-over-month sales in September, while SUVs and pickup trucks are expected to see year-over-year increases.
September 2020 Sales Forecast by Major Segment
Q3 2020 Sales and Year-to-Date Forecast
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 continents 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 annual revenues of $21 billion. www.coxautoinc.com
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