TrueCar, Inc., and its ALG, Inc. subsidiary, project total new vehicle sales will reach 1,307,998 units in October 2020, down 6.1% from a year ago when adjusted for the same number of selling days. This month’s seasonally adjusted annualized rate (SAAR) for total light vehicle sales is an estimated 15.7 million units. Excluding fleet sales, TrueCar and ALG expect U.S. retail deliveries of new cars and light trucks to be 1,188,043 units, an increase of 0.3% from a year ago when adjusted for the same number of selling days.
Average transaction prices (ATP) are projected to be up 3.1% or $1,223 from a year ago and up 0.7% or $262 from September 2020. TrueCar projects that U.S. revenue from new vehicle sales will reach more than $48 billion for October 2020, up 0.4% (based on a non-adjusted daily selling rate) from a year ago and down 2.5% from last month.
“The auto industry recovery is absolutely striking. We clawed back more new car sales each month since sales bottomed out in April and are now seeing year-over-year new car retail sales growth for two consecutive months. This is a phenomenal outcome for the industry, as inventory is starting to rebound and demand remains high. There are positive signals that the recovery will sustain,” said Eric Lyman, Chief Industry Analyst for ALG.
“A handful of brands, such as Mercedes and Subaru, are seeing an increase in sales month-over-month which is notable given that sales typically trend stronger in September than in October,” added Lyman. “These brands were hit harder by inventory shortages previously and are starting to replenish supply and address pent up demand.”
Additional Insights: (Forecast by ALG and TrueCar)
- Total retail sales for October 2020 are expected to be up 0.3% from a year ago and down 14.3% from September 2020 when adjusted for the same number of selling days.
- Fleet sales for October 2020 are expected to be down 43% from a year ago and down 6% from September 2020 when adjusted for the same number of selling days.
- Total SAAR is expected to decrease 5% from a year ago from 16.5 million units to 15.7 million units.
- Used vehicle sales for October 2020 are expected to reach 3.3 million, up 1% from a year ago and down 4% from September 2020.
- The average interest rates on new vehicles are 5.7% and the average interest rates on used vehicles are 8.1%.
“Domestic automakers such as FCA and GM have made significant jumps in retail sales year-over-year, as shoppers continue purchasing large utility vehicles and trucks,” said Nick Woolard, Director of OEM Analytics at TrueCar. “There was a 5.4% increase in demand for utility vehicles and an increase of 8.4% in demand for pickup trucks year-over-year on the TrueCar platform.”
“New vehicle average transaction prices continue to rise year-over-year due to this consumer preference toward larger vehicles. Used vehicle prices have also increased significantly in the past few months, as a result of the new car inventory shortages and strong consumer demand,” added Woolard. “On the TrueCar platform, used vehicle listing prices increased by 7.6% year over year, making this a great time for consumers who are looking to trade-in or sell their vehicles and use the funds to upgrade to a new vehicle.”
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