Auto sales likely to slow in June
June 29, 2012
Auto sales likely to slow in June
By BRYCE G. HOFFMAN / The Detroit News
Growing concern about the economy appears to be taking its toll on automobile sales in the United States, prompting analysts to dial down their projections for June sales.
But new car and truck sales are still expected to be well above last year’s tally for the month, and most expect the sales rebound to continue. Sales figures for June will be released Tuesday.
“Uncertainty in the financial markets brought selling rates below 14 million units for the second month in a row,” Jesse Toprak, vice president of market intelligence for automotive research site TrueCar.com, said in a statement. “(But) first half sales results this year indicate a relatively healthy car industry; perhaps the brightest spot in an otherwise struggling U.S. economy. We expect second half of 2012 to average around 14.5 million units, which will take us to over 15 million new cars sold in 2013.”
TrueCar expects new light vehicle sales in the United States to top 1.2 million units in June. That would translate into an 18.1 percent increase from June 2011, but a 6.9 percent decline from May 2012. Toprak estimates the seasonally adjusted annualized selling rate to come in at 13.6 million units for June — down from last month’s figure of 13.8 million, but up sharply from the 11.5 million recorded in June 2011.
Edmunds.com, another automotive research site, expects 1.3 million new cars to be sold in June, a 20.7 percent increase from June 2011, but a 4.7 percent decrease from May 2012. Edmunds said sales continued at a healthy pace for an estimated seasonally adjusted annual rate of 13.9 million light vehicles.
“While 13.9 SAAR is not as impressive as the performance in the first quarter of this year, this month’s results are still strong, considering that deferred demand following last year’s earthquake has virtually dried up,” Edmunds.com senior analyst Jessica Caldwell said in a statement. “But the healthiest sign for the industry is the pure volume of sales. June is expected to be the third highest-selling month since May 2008.”
Ford Motor Co. President of the Americas Mark Fields said Tuesday that a “mixed” economy will likely keep June’s auto sales pace consistent with that of May, with the June selling rate in the high 13 million range.
Fields said Ford is benefiting from strong demand for the new Ford Escape, which he said has been flying off dealer lots even ahead of its advertising campaign that does not start for a couple of weeks.
But TrueCar expects Ford’s sales to be only slightly better than they were a year ago — less than 1 percent. However, Edmunds predicts a 4.4 percent increase for Ford.
TrueCar predicts General Motors Co. will see a 6 percent year-over-year increase; Edmunds puts the increase at 8.7 percent.
Yet once again, it is the Chrysler Group LLC that looks to be the big winner among Detroit’s Big Three. TrueCar expects the carmaker’s sales to be up 16 percent; Edmunds predicts a 19.2 percent increase.
Chrysler sales chief Reid Bigland said Thursday his company is poised to post its 27th consecutive monthly sales increase.
Bigland said he is watching the economy closely, but says the June selling rate appears to be about the same as May’s. That is lower than earlier this year, but still ahead of what Chrysler and other automakers were expecting this year.
“We probably pulled ahead some summer sales in March and April, particularly in this part of the country where the weather was unseasonably warm. But we’re pretty comfortable that the industry as a whole is hanging in there,” Bigland said.
The Japanese are expected to be the ones with the most to celebrate. A year ago, the March 2011 earthquake and tsunami left them with little to sell. Now, they are coming back strong.
TrueCar expects Toyota Motor Corp. to post a 67.9 percent year-over-year sales increase, with Honda Motor Co. and Nissan Motor Co. gaining 50.7 percent and 23.7 percent respectively.
Edmunds predicts a 66.3 percent year-over-year increase for Toyota, with Honda Motor Co. and Nissan Motor Co. gaining 50.9 percent and 22.5 percent respectively.