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TrueCar: October new auto sales to reach highest level in over a decade

U.S. total new and used vehicle revenue to reach $1.2 trillion in 2015 TrueCar, Inc. (NASDAQ: TRUE), the modern car-buying service, projects total new vehicle sales, including fleet deliveries, will hit 1,427,500 units in October, an 11.4 percent increase from a year ago and the most for the month since 2001. The expected double-digit growth … Continued

U.S. total new and used vehicle revenue to reach $1.2 trillion in 2015

TrueCar, Inc. (NASDAQ: TRUE), the modern car-buying service, projects total new vehicle sales, including fleet deliveries, will hit 1,427,500 units in October, an 11.4 percent increase from a year ago and the most for the month since 2001.

The expected double-digit growth will push the seasonally adjusted annualized rate (SAAR) for total light vehicle sales to 17.9 million units compared to 16.6 million units a year ago. Continued consumer confidence coupled with attractive model year-end sales campaigns may boost retail sales 11.6 percent to 1,206,800 units.

“The industry remains hot with October marking the third month this year of double-digit growth,” said Eric Lyman, TrueCar’s vice president of industry insights. “Interest rates are still low, which helps move vehicles off lots for consumers ready to buy. Automakers’ promotions also sweetened the deal as the model-year close-outs carried over from September.”

Subaru may be the month’s sales leader with a 17.9 percent rise in volume, resulting in a best-ever October for the brand. Kia Motors America follows with a 15.2 percent increase in sales and should also post record October volume. FCA may rank third with a 14.9 percent sales gain due to strong Jeep brand sales likely to post a 31.3 percent gain. This would result in the 67th consecutive month of year-over-year sales gains for FCA. On a daily selling rate (DSR) basis, adjusting for one more day this month versus October 2014, sales should rise 7.4 percent.

Luxury cars and truck sales are expected to grow 9.9 percent compared to a year ago. Non-luxury volume will likely expand by 11.6 percent versus last year. Pickup truck, crossover and utility vehicles remain popular and continue to propel overall industry growth.

“We expect automakers to close the year with sales of 17.4 million new vehicles,” said Lyman. “Total auto market revenue should reach a record $1.2 trillion, highlighting the strength of both the new and used markets and the rich mix of vehicles being sold.”

TrueCar projects total revenue from U.S. sales of new and used vehicles will rise 7 percent this year to an all-time industry record of $1.2 trillion. U.S. consumers will likely buy a total of 55.8 million new and used cars and light trucks in 2015, up 4.2 percent over 53.5 million in 2014.

Incentive spending by automakers averaged $3,104 per vehicle in October, up 14.1 percent from a year ago and down 1.2 percent from September 2015.

“A drag in model year-end sales and promotions can be attributed to increasing levels of incentives,” said Stacey Doyle, TrueCar’s senior industry analyst. “Last month only 27 percent of sales comprised new model-year vehicles versus 32 percent September 2014, which means this year heavier incentives dollars historically spent in September overflowed into October.”

Interest rates remain unchanged and overall U.S. economic conditions are still strong. The Conference Board’s Consumer Confidence Index® improved by 1.7 points in September, hitting 103. Meanwhile, the unemployment report in September was 5.1 percent, the lowest for the month in eight years. Gas prices also remain favorable, falling to a national average of $2.20 per gallon on October 26 from $3.05 a year earlier.

Other key findings for October:

  • Expected registration mix of 84.5 percent retail sales and 15.5 percent fleet versus 84.4 percent retail and 15.6 percent fleet last October.
  • Total used auto sales, including franchise and independent dealerships and private-party transactions, may exceed 3,023,686, down 2.3 percent compared to October 2014.

Forecasts for the 12 largest manufacturers by volume:

Total Unit Sales

Manufacturer October 2015 Forecast % Change vs. October 2014 % Change vs. October 2014 (Daily Selling Rate)
BMW                           37,600 4.5% 0.8%
Daimler                           32,100 2.5% -1.2%
FCA                        197,200 14.9% 10.8%
Ford                        211,000 12.3% 8.3%
GM                        257,800 13.7% 9.6%
Honda                        131,200 8.3% 4.4%
Hyundai                           57,500 14.8% 10.7%
Kia                           51,500 15.2% 11.1%
Nissan                        113,000 9.6% 5.7%
Subaru                           50,700 17.9% 13.7%
Toyota                        199,100 10.3% 6.3%
Volkswagen Group                           46,600 -5.9% -9.3%
Industry                   1,427,500 11.4% 7.4%

 

Total Market Share

Manufacturer October 2015 Forecast October 2014 September 2015
BMW 2.6% 2.8% 2.2%
Daimler 2.2% 2.4% 2.2%
FCA 13.8% 13.4% 13.4%
Ford 14.8% 14.7% 15.3%
GM 18.1% 17.7% 17.4%
Honda 9.2% 9.5% 9.3%
Hyundai 4.0% 3.9% 4.4%
Kia 3.6% 3.5% 3.5%
Nissan 7.9% 8.0% 8.4%
Subaru 3.6% 3.4% 3.7%
Toyota 13.9% 14.1% 13.5%
Volkswagen Group 3.3% 3.9% 3.3%

 

Retail Unit Sales

Manufacturer October 2015 Forecast % Change vs. October 2014 % Change vs. October 2014 (Daily Selling Rate)
BMW                           36,600 4.1% 0.3%
Daimler                           30,700 2.3% -1.4%
FCA                        146,200 11.9% 7.9%
Ford                        157,000 15.8% 11.6%
GM                        200,400 14.4% 10.4%
Honda                        129,800 7.9% 4.1%
Hyundai                           46,900 17.0% 12.8%
Kia                           44,200 11.7% 7.7%
Nissan                           99,000 10.9% 6.9%
Subaru                           48,600 16.3% 12.2%
Toyota                        186,000 12.5% 8.4%
Volkswagen Group                           43,454 0.0% -3.6%
Industry                     1,206,800 11.6% 7.6%

 

Incentive Spending

Manufacturer

Incentive per Unit October 2015 Forecast

Incentive per Unit % Change vs. October 2014

Incentive per Unit % Change vs. September 2015

Total Spending October 2015 Forecast

BMW $4,647 -11.1% -0.4% $174,256,147
Daimler $4,597 29.1% -4.0% $147,558,647
FCA $3,546 14.5% 1.2% $694,233,108
Ford $3,659 14.3% -0.3% $772,143,707
GM $3,842 16.4% -4.3% $990,442,734
Honda $2,093 13.4% 1.3% $274,647,758
Hyundai $2,408 74.6% 0.3% $138,476,808
Kia $2,826 13.5% 0.3% $145,555,821
Nissan $3,409 3.8% -1.9% $385,183,210
Subaru $591 -0.6% -1.8% $29,972,370
Toyota $2,146 13.9% -7.9% $427,362,214
Volkswagen Group $3,363 29.4% 6.1% $155,690,622
Industry $3,104 14.1% -1.2% $4,418,994,251

 

(Note: This forecast is based solely on TrueCar’s analysis of industry sales trends and conditions and is not a projection of the company’s operations.)

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