A strong Labor Day helped boost Sept. sales.
Despite economic turmoil and increasing fears of a double-dip recession, sales of new vehicles continued to hold steady during September, according to preliminary industry estimates.
For September 2011, new light vehicle sales in the U.S., including fleet, are expected to be somewhere between 1.04 and 1.06 million units, depending on whose data you trust. Either way, that would bring a roughly 10% jump from year-earlier numbers.
While “The uncertain global environment, specifically the debt troubles in Europe, continue to be the major source of downside risk” to the U.S. economy and auto sales, in particular, said John Humphrey, chief of automotive operations at J.D. Power and Associates, his associate Jeff Schuster found that, “Coming off a solid Labor Day sale, retail sales exhibited unexpected strength in the second week of September, as the recovering inventory levels have helped to bring buyers back into the market.”
Power estimates September sales will have totaled 1.038 million overall, while TrueCar.com puts the figure slightly higher, at 1.055 million.
The September 2011 forecast from TrueCcar translates into a Seasonally Adjusted Annualized Rate, or SAAR of 13.1, million, notably up from 12.1 million in August 2011 and 11.7 million in September 2010.
True Car, which tracks sales trends, estimate retail sales are up 10.7% compared to September 2010 and up 0.2% from August 2011, making car sales one of the few bright spots in the economic landscape now dominated by anemic growth. Corporate and government fleet and rental sales are expected to make up 20% of total industry sales for September. Automakers will report their actual sales figures next week.
“New vehicle sales are doing particularly well, even with worries of a recession and another wild month for the financial markets in September” observed Jesse Toprak, TrueCar vice president of Industry Trends and Insights. “If the current trends hold, we expect 2011 total new light vehicle sales to be 12.75 million units up 10 percent from 2010,” he added.
The industry average incentive spending per unit is also increasing approximately 3.8% to $2,716 in September 2011. But incentives are still lower by 1% than they were a year ago by TrueCar’s estimates.
Most of the increase is coming from Toyota and Honda, noted Kristen Andersson, TrueCar automotive analyst. “Now that Honda and Toyota have increased levels of inventory, they are spending money at record levels to move cars,” she said.
The bigger of the two Japanese makers has promised its most aggressive launch ever to send off the all-new Camry sedan. Honda, meanwhile, is effectively re-launching its 2012 Civic, which came to market just as Japan was struck by the devastating March 11 earthquake and tsunami. That disaster meant months of short production for all of the Japanese makers, giving U.S., Korean and Japanese rivals a chance to pick up market share and sales brands like Honda and Toyota now hope to win back.
Significantly, industry estimates suggest that after surging for much of the year, used car sales also increased 4.5% from September 2010 but were down 15.4% from August 2011.