June Auto Sales Likely to Rebound From May’s Shortfall on Buoyant Retail Demand

Industry volume may rise 5.4%, led by Subaru, FCA, Kia and Honda

SANTA MONICA, Calif.--()--TrueCar, Inc. (NASDAQ: TRUE) projects total new vehicle sales, including fleet deliveries, will reach 1,556,844 units in June, up 5.4 percent from a year ago, as consumers return to dealer lots this month after disappointing industrywide volume in May.

The seasonally adjusted annualized rate (SAAR) for total light vehicle sales in June is an estimated 17.2 million units, up from 17 million units a year ago. On a daily selling rate basis, overall sales may expand by 1.4 percent when adjusting for one additional sales day versus June 2015. Excluding sales to daily rental, commercial and government fleets, retail deliveries of new cars and light trucks will likely rise by 6.4 percent to 1,292,670 units.

“It’s clear that the industry shortfall in May was a case of demand deferred to June,” said Eric Lyman, TrueCar’s vice president of industry insights. “July should also get off to a good start as Independence Day weekend typically sees aggressive sales promotions. The fact that new car and truck deliveries, after six consecutive years of growth, continue to rise half-way to seven years underscores the strength of retail demand.”

Subaru may lead gains for the month with a 15 percent year-over-year rise in deliveries of its all-wheel-drive cars, wagons and crossovers, followed by Kia Motors with an 11 percent increase. FCA is estimated to rank third with a 9.7 percent increase for the month, followed by an 8.8 percent gain for Honda Motor, which is benefitting from demand for its revamped Civic compact car line.

Volume for non-luxury, mass-market brands will likely rise by 5.6 percent versus the year-ago month, and sales of luxury models may expand by 4.7 percent.

Incentive spending by automakers averaged an estimated $3,116 per vehicle in June, up 8.6 percent from a year ago, but down 0.9 percent from May 2016.

“There may be exceptions, but it’s reassuring that automakers as a group are keeping incentive spending within a reasonable range,” said Oliver Strauss, vice president of forecasting for TrueCar’s ALG unit. “The U.S. economic expansion has cooled, but we’re optimistic that it can reaccelerate in the second half of the year – particularly with regard to the labor market.”

The Federal Open Market Committee once again left interest rates unchanged this month, citing a softer jobs picture despite generally healthy U.S. economic conditions. May’s unemployment rate narrowed to 4.7 percent, the lowest for the month in nine years, though job growth fell far short of expectations. Gasoline prices remain favorable for consumers, averaging $2.325 per gallon nationwide as of June 21, according to AAA’s Daily Fuel Gauge Report, down from $2.792 a year ago.

Other key findings for June:

  • Registration mix is expected to be 83 percent retail sales and 17 percent fleet versus 82.3 percent retail and 17.7 percent fleet last June.
  • Total used auto sales, including franchise and independent dealerships and private-party transactions, may reach 3,244,080 units, up 5.5 percent from June 2015.
  • Similarly, combined volume for new and used auto sales may reach 4,800,924 units, a 5.5 percent increase from June 2015.

Table 1: Forecasts for the 12 largest manufacturers by volume

Manufacturer  

Jun 2016
Forecast

  Jun 2015   May 2016  

% Change vs.
Jun 2015

 

% Change vs.
Jun 2015
(Daily Selling
Rate)

BMW   36,500   38,427   33,685   -5.0%   -8.7%
Daimler   32,800   31,260   32,567   4.9%   0.9%
FCA   204,065   186,009   205,397   9.7%   5.5%
Ford   234,464   224,681   234,748   4.4%   0.3%
GM   261,156   259,353   240,450   0.7%   -3.2%
Honda   146,250   134,397   147,108   8.8%   4.6%
Hyundai   71,666   67,502   71,006   6.2%   2.1%
Kia   60,120   54,137   62,926   11.1%   6.8%
Nissan   132,489   124,228   133,496   6.6%   2.5%
Subaru   51,100   44,335   50,083   15.3%   10.8%
Toyota   221,105   209,912   219,339   5.3%   1.3%
Volkswagen Group   51,070   53,226   52,291   -4.1%   -7.7%
Industry   1,556,844   1,476,675   1,536,276   5.4%   1.4%

Table 2: Total Market Share

Manufacturer   Jun 2016 Forecast   Jun 2015   May 2016
BMW   2.3%   2.6%   2.2%
Daimler   2.1%   2.1%   2.1%
FCA   13.1%   12.6%   13.4%
Ford   15.1%   15.2%   15.3%
GM   16.8%   17.6%   15.7%
Honda   9.4%   9.1%   9.6%
Hyundai   4.6%   4.6%   4.6%
Kia   3.9%   3.7%   4.1%
Nissan   8.5%   8.4%   8.7%
Subaru   3.3%   3.0%   3.3%
Toyota   14.2%   14.2%   14.3%
Volkswagen Group   3.3%   3.6%   3.4%

Table 3: Retail Unit Sales

Manufacturer  

Jun 2016
Forecast

  Jun 2015   May 2016  

% Change vs.
Jun 2015

 

% Change vs.
Jun 2015
(Daily Selling
Rate)

BMW   35,605   37,716   32,774   -5.6%   -9.2%
Daimler   30,625   29,129   30,616   5.1%   1.1%
FCA   159,065   147,125   162,022   8.1%   4.0%
Ford   154,464   144,907   169,459   6.6%   2.5%
GM   213,156   206,814   182,321   3.1%   -0.9%
Honda   144,334   133,203   144,939   8.4%   4.2%
Hyundai   53,884   49,571   58,063   8.7%   4.5%
Kia   50,903   45,534   52,819   11.8%   7.5%
Nissan   105,795   105,303   106,600   0.5%   -3.4%
Subaru   47,944   41,179   46,906   16.4%   12.0%
Toyota   201,105   182,458   194,052   10.2%   6.0%
Volkswagen Group   50,010   50,010   49,415   0.0%   -3.8%
Industry   1,292,670   1,215,483   1,277,011   6.4%   2.3%

Table 4: Incentive Spending

Manufacturer  

Incentive
per Unit
Jun 2016
Forecast

 

Incentive
per Unit
Jun 2015

 

Incentive
per Unit
May 2016

 

Incentive
per Unit %
Change vs.
Jun 2015

 

Incentive
per Unit %
Change vs.
May 2016

 

Total
Spending Jun
2016 Forecast

BMW   $5,235   $4,290   $5,724   22.0%   -8.6%   $190,688,496
Daimler   $4,499   $4,209   $4,737   6.9%   -5.0%   $147,560,240
FCA   $4,101   $3,393   $4,115   20.9%   -0.3%   $832,488,081
Ford   $3,516   $2,595   $3,596   35.5%   -2.2%   $824,384,514
GM   $3,991   $3,909   $4,057   2.1%   -1.6%   $1,050,340,539
Honda   $1,845   $1,915   $1,756   -3.7%   5.1%   $269,889,322
Hyundai   $2,133   $2,485   $2,104   -14.2%   1.4%   $152,831,133
Kia   $2,725   $2,686   $2,734   1.5%   -0.3%   $163,832,771
Nissan   $3,208   $3,398   $3,242   -5.6%   -1.0%   $425,020,652
Subaru   $616   $767   $610   -19.6%   1.1%   $31,501,367
Toyota   $2,108   $2,006   $2,176   5.1%   -3.1%   $466,194,758
Volkswagen Group   $3,585   $3,099   $3,605   15.7%   -0.6%   $182,205,842
Industry   $3,116   $2,871   $3,146   8.6%   -0.9%   $4,845,132,730

Note: This forecast is based solely on TrueCar’s analysis of industry sales trends and conditions and is not a projection or reflection of the company’s operations.

About TrueCar

TrueCar, Inc. (NASDAQ: TRUE) is a digital automotive marketplace that provides comprehensive pricing transparency about what other people paid for their cars and enables consumers to engage with TrueCar Certified Dealers who are committed to providing a superior purchase experience. TrueCar operates its own branded site and its nationwide network of more than 11,000 Certified Dealers also powers car-buying programs for some of the largest U.S. membership and service organizations, including USAA, AARP, American Express, AAA and Sam's Club. Over one third of all new car buyers engage with the TrueCar network during their purchasing process. TrueCar is headquartered in Santa Monica, California, with offices in San Francisco and Austin, Texas. For more information, go to www.truecar.com. Follow us on Facebook or Twitter.

TrueCar media line: +1-844-469-8442 (US toll-free) | Email: pressinquiries@truecar.com

Contacts

TrueCar, Inc.
Veronica Cardenas, 424-258-8427
VCardenas@truecar.com
pressinquiries@truecar.com

Contacts

TrueCar, Inc.
Veronica Cardenas, 424-258-8427
VCardenas@truecar.com
pressinquiries@truecar.com