June vehicle sales appear mixed, but all signs point to strong 2014

car sales

(Photo: autoblog.com)

 

June new-vehicle sales might have looked like a mixed bag to a casual observer.

Sales were down from May, which was a torrid sales month, but up over June of 2013. And then there were the strong second quarter and six-months’ results and expectations for the year.

All told, analysts suggested, there were signs the industry could have its best year since at least 2007.

“Summer selling season is off to a better start than last year, despite one fewer weekend this June,” said John Krafcik, president of TrueCar Inc. “Strong retail sales and stable incentive spending heading into the heart of summer give us confidence that 2014 will be the best year for automakers since 2007.”

“It’s important to recognize that June sales are being heavily influenced by a quirk of the industry sales calendar,” said John Humphrey of J.D. Power’s global automotive practice. “When combined, May and June retail sales are expected to be up 7.2 percent, compared with May and June 2013, which underscores the continued positive trajectory in growth and overall health of the industry.”

J.D. Power also expected total new-vehicle retail sales to reach 6.5 million for the first half of 2014, a 6 percent increase over the first half of 2013.

“An attractive collection of new models as well as improved affordability due to very low interest rates and lease specials continued to bring customers into showrooms,” said Jesse Toprak, chief analyst for Cars.com. “We expect the rest of 2014 to continue to track above 16 million units.”

The Seasonally Adjusted Annual Rate (SAAR), an industry measure of sales of cars and light trucks, topped 16.9 million for June, which actually was slightly higher than the May SAAR.

Retail sales were expected to be down 10-15 percent from May, according to sources such as TrueCar Inc., Cars.comand Kelley Blue Book, but analysts generally attributed that to fewer selling days. June typically is a slower sales month than May because of summer vacations.

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Meanwhile, used car sales through the midpoint of 2014 also were expected to increase over 2013, according to a report by Joe Overby, editor at Auto Remarketing.

Overby cited CNW Research’s latest Retail Automotive Survey in which the firm was predicting June used-car sales to be just under 4.5 million units, pushing the six-month figure to 20.33 million. The mid-year mark would be a 0.9 percent increase from the pace of 2013, CNW indicated.

 

– Mark Macesich

Posted in Outlook, Trends

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