New car sales are expected to rise, especially at GM where new utes, like the Chevy Traverse, are expected to see increases.
Sales of new vehicles in August are expected to increase 1.5% year-over-year, snapping a seven-month string in which sales of new cars, trucks and utility vehicles had dropped, according to a new forecast from Kelley Blue Book.
“August should be the first year-over-year increase of 2017, due in part to an extra selling day this month,” said Tim Fleming, analyst for Kelley Blue Book. “This sales improvement would break a seven-month negative streak, the longest since the recession in 2009,” he noted.
One unforeseen factor, which could alter the forecast, is the impact of Hurricane Harvey, which could disrupt sales in a wide area, stretching across Texas and Louisiana. Texas is the second-largest market for new vehicles in the U.S. and the storm is barreling down on the Houston metropolitan area, one of the largest in the U.S.
KBB’s forecast calls for vehicle in August to total of 1.53 million units, resulting in an estimated 16.6 million seasonally adjusted annual rate or SAAR.
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Subaru's new Crosstrek is helping the automaker to its highest market share ever.
The predicted August SAAR is consistent with the 16.6 million sales total in July, KBB analysts noted. Fleet sales are expected to be down 4%, while retail sales are still holding strong and are projected to grow 2% in August 2017. Overall, retail sales are expected to account for 86.1% of volume in August 2017, up from 85.3% in August 2016, KBB said.
“However, incentives average more than 10% of transaction prices and are helping support retail growth. For the year, fleet sales are down more than 10%, so an increase in fleet orders could be on the horizon and provide a sales lift later this year,” the KBB forecast noted.
After a record year of sales in 2016 and seven consecutive annual increases, Kelley Blue Book’s forecast for 2017 calls for sales in the range of 16.8 and 17.3 million units, which represents a 1 to 4 percent decrease from last year.
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KBB anticipates mixed results from automakers for this month.
General Motors, which had a dismal July, could gain the most market share of the major manufacturers on the strength of its SUVs and trucks. “GM has introduced a host of new utility vehicles in the past year, hitting the market at the right time, and as a result, the Chevrolet Equinox, GMC Acadia and Chevrolet Traverse should report significant sales increases,” the KBB forecast said.
GM trucks also should have a strong month and help outweigh considerable declines from their car line-up. GM’s light trucks could represent 80% of their sales volume in August, up from 70% just one year ago.
Another successful brand for August 2017 is Subaru, which could grow more than 7% in August. Overall, Subaru is expected to post its highest monthly market share ever at 4.2%. With current growth led by the Impreza and Outback, Subaru is poised for continued success with the redesigned Crosstrek to launch soon, KBB noted.
(To see more about July auto sales, Click Here.)
Toyota, Honda and Nissan also are expected to post sales increases, while Ford Motor Co. and Fiat Chrysler Automobiles N.V. will see their sales totals drop in August, KBB said.