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Weakness in June New-Vehicle Retail Sales Will be Partially Offset by Fleet Sales

July 1, 2010

An increase in fleet sales in June is not strong enough to fully offset weaker-than-expected retail sales, resulting in a decline in the total new-vehicle selling rate from May, according to J.D. Power and Associates, which gathers real-time transaction data from more than 8,900 retail franchisees throughout the United States.

Retail Light-Vehicle Sales

June new-vehicle retail sales are expected to come in at 768,000 units, which represents a seasonally adjusted annualized rate (SAAR) of 8.6 million units. June's selling rate is expected to be down from May's selling rate of 8.9 million units, but up from a selling rate of 8.2 million units in June 2009.

"With the improving economic environment, retail sales should be stronger than they currently are, but June marks the second consecutive month with a selling rate below 9 million units," said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. "In spite of the more favorable conditions, it appears that consumers remain skittish and have yet to respond by buying vehicles at expected levels."

U.S. Retail SAAR from June 2009 to June 2010 (in millions of units)

Total Light-Vehicle Sales

Fleet sales in June are again expected to offset some of the weakness in the retail market, with volume projected to total 203,000 units - up 59 percent from June 2009. As a result, total light-vehicle sales for June are expected to come in 971,000 units, up 13 percent from one year ago.

J.D. Power and Associates U.S. Sales and SAAR Comparisons

 

June 2010(1)

May 2010

June 2009

New-vehicle retail sales

768,000 units

(5% higher than June 2009)

847,138 units

730,627 units

Total vehicle sales

971,000 units

(13% higher than June 2009)

1,100,565 units

857,952 units

Retail SAAR

8.6 million units

8.9 million units

8.2 million units

Total SAAR

10.9 million units

11.5 million units

9.7 million units

(1) Figures cited for June 2010 are forecasted based on the first 16 selling days of the month.

 

 

 

 

Sales Outlook

Given the continued weakness in the retail market, J.D. Power and Associates is decreasing its retail sales forecast slightly to 9.5 million units (from 9.7 million units). The forecast for total sales remains at 11.8 million units.

"With the recovery not progressing as expected, it's gut-check time for the automotive industry," said Schuster. "The industry's discipline will be put to the test even more in the coming months if a more pronounced recovery doesn't get underway."

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