DETROIT, Jan. 28, 2016 /PRNewswire/ -- Despite heavy snows that hit the East Coast last weekend, an average of 36,499 new-vehicles are projected to be sold each day—known as the daily selling rate (DSR)—at dealerships in January, a record daily pace for retail sales for the month, according to a monthly sales forecast developed jointly by J.D. Power and LMC Automotive.
The seasonally adjusted annualized rate (SAAR1) for retail sales in January 2016 is expected to reach 13.9 million units, up from 13.8 million units in January 2015, and would be the strongest retail SAAR in the month of January since 2004 (13.9 million). Retail transactions are the most accurate measure of true underlying consumer demand for new vehicles.
Even with the brisk daily selling rate, new-vehicle retail sales on an absolute volume basis are expected to be down in January, due in large part to two fewer selling days compared with January 2015. New-vehicle retail sales in January are projected to reach 876,000 units, a 2.9% increase on a selling-day adjusted basis, but down from 922,055 in January 2015.
Retail Light-Vehicle Sales
Snow Storm Jonas has had a significant impact on car sales. During the storm-affected weekend (January 22-24), new-vehicle retail sales were down 30% in the eastern regions, compared with the same period a year ago. In contrast, sales in the western regions increased 5%.
"The snow storm on the East Coast disrupted an estimated 15,000 sales," said John Humphrey, senior vice president of the global automotive practice at J.D. Power. "Despite the storm, we're still seeing a strong month. It's also important to note that sales weren't necessarily lost during the storm. We expect to see some of those sales made up this month, and the majority of them recovered in February."
Humphrey noted that J.D. Power and LMC Automotive will continue to monitor the effects of Jonas on new-vehicle sales through the remainder of the month and in February.
Through the first 17 selling days of the month, the average transaction price of $30,769 is the highest level ever for any January, surpassing the previous high of $30,707 set in 2015.
Total Light-Vehicle Sales
Total light-vehicle sales are expected to reach 1,097,000, a 3.4% increase on a selling-day adjusted basis, compared with January 2015. The SAAR for total sales projected to reach 16.8 million units in January 2016, up from 16.7 million in a year ago and the highest rate since 2006.
J.D. Power and LMC Automotive U.S. Sales and SAAR Comparisons | |||
January 20161 | December 2015 | January 2015 | |
New-Vehicle Retail Sales | 876,000 units2 (2.9% higher than January 2015) | 1,371,607 units | 922,055 units |
Total Vehicle Sales | 1,097,000 units (3.4% higher than January 2015) | 1,640,370 units | 1,149,261 units |
Retail SAAR | 13.9 million units | 14.6 million units | 13.8 million units |
Total SAAR | 16.8 million units | 17.3 million units | 16.7 million units |
1Figures cited for January 2015 are forecasted based on the first 17 selling days of the month. | |||
2The percentage change is adjusted based on the number of selling days in the month (24 days in January 2016 vs. 26 days in January 2015). | |||
Fleet volume in January 2016 is projected to hit 221,100 units, a 5.4% increase on a selling-day adjusted basis from January 2015. Fleet share is expected to be 20% for January, the same level and volume as a year ago.
Sales Outlook
LMC Automotive's forecast for 2016 remains 17.8 million units for total light-vehicle sales, but the outlook for retail light-vehicle sales was revised down 500,000 to 14.5 million units.
"We expect 2016 to be another record year, but all eyes will be tracking the expected slower growth rate as the year progresses," said Jeff Schuster, senior vice president of forecasting at LMC Automotive. "All brands will not be able to grow as they have over the past few years, creating a higher level of competitive intensity and pressure on each brand."
North American Production
North American production in December 2015 was 1.256 million units, a 1.4% increase compared with December 2014. Production finished the year at 17.5 million units, a 3% increase. Inventory starts the year with a 61-day supply, down from a 65-day supply in December. LMC Automotive is maintaining its production forecast 2016 forecast at 18.1 million units, the first time volume in North America will cross the 18 million-unit level.
About J.D. Power
J.D. Power is a global marketing information services company providing performance improvement, social media and customer satisfaction insights and solutions. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. Power Information Network (PIN) from J.D. Power has revolutionized the automotive industry by collecting and analyzing real-time transaction-level data for new and used vehicles. PIN's data and analytics help automakers and dealers manage risk, monitor metric performance and improve business results. Headquartered in Costa Mesa, Calif., J.D. Power has offices in North/South America, Europe and Asia Pacific. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit www.JDPower.com. J.D. Power is a business unit of McGraw Hill Financial.
About McGraw Hill Financial
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include Standard & Poor's Ratings Services, S&P Capital IQ and SNL, S&P Dow Jones Indices, Platts, CRISIL and J.D. Power. The Company has approximately 20,000 employees in 31 countries. Additional information is available at www.mhfi.com.
About LMC Automotive
LMC Automotive is the premier supplier of automotive forecasts and intelligence to an extensive client base of automotive manufacturer, component supplier, logistics and distribution companies, as well as financial and government institutions around the world. LMC's global forecasting services encompass automotive sales, production and powertrain expertise, as well as advisory capability. LMC Automotive has locations in the United States, the UK, France, Germany, China, Japan and Thailand and is part of the Oxford, UK-based LMC group, the global leader in economic and business consultancy for the agribusiness sector. For more information please visit www.lmc-auto.com.
Media Relations Contacts
John Tews; J.D. Power; Troy, Mich.; 248-680-6218; media.relations@jdpa.com
Emmie Littlejohn; LMC Automotive; Troy, Mich.; 248-817-2100; elittlejohn@lmc-auto.com
No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power or LMC Automotive. www.jdpower.com/corporate www.lmc-auto.com
1SAAR is a rate adjustment that attempts to remove the seasonal variations in the data. Most data is affected by the time of the year. Adjusting for the seasonality in data means that more accurate comparisons can be drawn from month to month year-round.
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SOURCE J.D. Power
