Average transaction prices likely to increase 1.9%
TrueCar, Inc. (NASDAQ: TRUE) estimates that U.S. new vehicle sales totaled $44 billion in February, up 8.6 percent from a year ago and a record for the month. February marked the auto industry’s 26th consecutive month of year-over-year revenue expansion.
Higher average transaction prices helped automakers post a $3.5 billion gain in revenue versus February 2015, despite a projected 11 percent increase in incentive spending. As previously announced, TrueCar estimates sales of new cars and light trucks grew 6.6 percent last month.
“Transaction prices and revenue gains continued to climb this month underlining the continued vibrancy of the auto industry,” said Eric Lyman, TrueCar’s Vice President of industry insights. “Cupid was hard at work in February, as consumers continued to brave the winter weather to land the best deal on the vehicle they love. Some manufacturers will likely benefit with double-digit percentage increases this month.”
TrueCar estimates the average transaction price (ATP) for a new light vehicle was $32,910 in February, up 1.9 percent from a year ago. Average incentive spending per unit rose by $295 to $2,975. The ratio of incentive spending to ATP was 9 percent, up from 8.3 percent a year ago.
“Incentive spending restraint by several manufacturers helped ATP rise last month,” said Stacey Doyle, TrueCar’s senior industry analyst. “Notably, Honda, Kia and Subaru all pulled back their spending and saw improved incentive to ATP ratios.”
TrueCar projects average transaction prices for new vehicles will reach $33,925 in 2016, up 4.2 percent from a year ago. Incentive spending will grow more moderately, rising 3 percent compared to 2015. Average incentive spend per unit should reach $3,011. Overall industry revenue from new vehicles should hit $610.6 billion, up 7.3 percent compared to 2015.
February Average Transaction Price
| Manufacturer | Feb. 2016 Forecast | Feb. 2015 | Jan. 2016 | Percent Change vs. Feb. 2015 | Percent Change vs. Jan. 2016 |
| BMW (BMW, Mini) | $52,948 | $53,202 | $52,128 | -0.5% | 1.6% |
| Daimler (Mercedes-Benz, Smart) | $56,206 | $56,178 | $56,836 | 0.1% | -1.1% |
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | $33,348 | $32,149 | $32,980 | 3.7% | 1.1% |
| Ford (Ford, Lincoln) | $34,808 | $34,839 | $35,502 | -0.1% | -2.0% |
| GM (Buick, Cadillac, Chevrolet, GMC) | $36,196 | $35,055 | $35,857 | 3.3% | 0.9% |
| Honda (Acura, Honda) | $27,590 | $27,703 | $27,705 | -0.4% | -0.4% |
| Hyundai | $23,440 | $24,806 | $23,271 | -5.5% | 0.7% |
| Kia | $23,289 | $24,013 | $23,490 | -3.0% | -0.9% |
| Nissan (Nissan, Infiniti) | $27,391 | $27,488 | $27,581 | -0.4% | -0.7% |
| Subaru | $27,587 | $27,021 | $27,468 | 2.1% | 0.4% |
| Toyota (Lexus, Scion, Toyota) | $31,364 | $30,433 | $31,476 | 3.1% | -0.4% |
| Volkswagen (Audi, Porsche, Volkswagen) | $39,408 | $38,474 | $40,909 | 2.4% | -3.7% |
| Industry | $32,910 | $32,307 | $33,013 | 1.9% | -0.3% |
TrueCar estimates the average incentive for light vehicles in February will increase $295, or 1.9 percent, from a year ago, and decrease $15, or 0.3 percent, from January 2016.
February Incentive per Unit Spending
| Manufacturer | Feb. 2016 Forecast | Feb. 2015 | Jan. 2016 | Percent Change vs. Feb. 2015 | Percent Change vs. Jan. 2016 |
| BMW (BMW, Mini) | $4,355 | $3,772 | $4,192 | 15.5% | 3.9% |
| Daimler (Mercedes-Benz, Smart) | $3,731 | $3,972 | $3,592 | -6.1% | 3.9% |
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | $3,869 | $3,376 | $3,856 | 14.6% | 0.3% |
| Ford (Ford, Lincoln) | $2,996 | $2,756 | $3,054 | 8.7% | -1.9% |
| GM (Buick, Cadillac, Chevrolet, GMC) | $4,010 | $3,103 | $4,094 | 29.2% | -2.1% |
| Honda (Acura, Honda) | $1,747 | $1,807 | $1,672 | -3.3% | 4.5% |
| Hyundai | $1,945 | $2,159 | $1,904 | -9.9% | 2.2% |
| Kia | $2,815 | $2,933 | $2,823 | -4.0% | -0.3% |
| Nissan (Nissan, Infiniti) | $3,271 | $3,179 | $3,502 | 2.9% | -6.6% |
| Subaru | $555 | $798 | $570 | -30.4% | -2.6% |
| Toyota (Lexus, Scion, Toyota) | $2,049 | $1,891 | $2,093 | 8.3% | -2.1% |
| Volkswagen (Audi, Porsche, Volkswagen) | $3,216 | $2,644 | $3,155 | 21.7% | 1.9% |
| Industry | $2,975 | $2,680 | $2,990 | 11.0% | -0.5% |
This month’s ratio of incentive to ATP for light vehicles was 9.0 percent, up 9.0 percent from February 2015 and down 0.2 percent from January 2016, based on TrueCar analysis. Subaru, Daimler and Hyundai show the most improvement in ATP ratio in February versus the year-earlier month.
February Incentive Spending as a Percentage of ATP
| Manufacturer | Feb. 2016 Forecast | Feb. 2015 | Jan. 2016 | Percent Change vs. Feb. 2015 | Percent Change vs. Jan. 2016 |
| BMW (BMW, Mini) | 8.2% | 7.1% | 8.0% | 16.0% | 2.3% |
| Daimler (Mercedes-Benz, Smart) | 6.6% | 7.1% | 6.3% | -6.1% | 5.0% |
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | 11.6% | 10.5% | 11.7% | 10.5% | -0.8% |
| Ford (Ford, Lincoln) | 8.6% | 7.9% | 8.6% | 8.8% | 0.1% |
| GM (Buick, Cadillac, Chevrolet, GMC) | 11.1% | 8.9% | 11.4% | 25.2% | -3.0% |
| Honda (Acura, Honda) | 6.3% | 6.5% | 6.0% | -2.9% | 4.9% |
| Hyundai | 8.3% | 8.7% | 8.2% | -4.6% | 1.4% |
| Kia | 12.1% | 12.2% | 12.0% | -1.1% | 0.6% |
| Nissan (Nissan, Infiniti) | 11.9% | 11.6% | 12.7% | 3.3% | -5.9% |
| Subaru | 2.0% | 3.0% | 2.1% | -31.8% | -3.0% |
| Toyota (Lexus, Scion, Toyota) | 6.5% | 6.2% | 6.7% | 5.1% | -1.8% |
| Volkswagen (Audi, Porsche, Volkswagen) | 8.2% | 6.9% | 7.7% | 18.8% | 5.8% |
| Industry | 9.0% | 8.3% | 9.1% | 9.0% | -0.2% |
February Total Net Revenue
| Manufacturer | Feb. 2016 Forecast | Feb. 2015 | Percent Change vs. Feb. 2015 |
| BMW (BMW, Mini) | $1,498,419,668 | $1,542,485,586 | -2.9% |
| Daimler (Mercedes-Benz, Smart) | $1,534,428,158 | $1,446,527,322 | 6.1% |
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | $5,939,249,291 | $5,274,589,983 | 12.6% |
| Ford (Ford, Lincoln) | $7,073,013,331 | $6,259,627,647 | 13.0% |
| GM (Buick, Cadillac, Chevrolet, GMC) | $8,915,172,870 | $8,110,955,790 | 9.9% |
| Honda (Acura, Honda) | $3,112,129,231 | $2,921,724,598 | 6.5% |
| Hyundai | $1,265,786,382 | $1,302,439,030 | -2.8% |
| Kia | $1,059,629,485 | $1,057,292,390 | 0.2% |
| Nissan (Nissan, Infiniti) | $3,489,567,732 | $3,255,568,768 | 7.2% |
| Subaru | $1,153,137,747 | $1,117,534,518 | 3.2% |
| Toyota (Lexus, Scion, Toyota) | $5,868,203,901 | $5,492,152,211 | 6.8% |
| Volkswagen (Audi, Porsche, Volkswagen) | $1,564,494,866 | $1,564,198,944 | 0.0% |
| Industry | $44,104,061,558 | $40,629,897,033 | 8.6% |
