DETROIT May 23 U.S. auto sales in May are
expected to rise about 8 percent and the annual sales pace
should rebound back above 15 million vehicles after a
disappointing result in the prior month, two research reports
said on Thursday.
Sales of new cars and trucks in May are expected to top 1.43
million vehicles, while the annual sales pace is forecast to hit
15.2 million vehicles, according to a report by J.D. Power and
Associates and LMC Automotive, as well as one by TrueCar.com.
The annual sales pace had topped 15 million vehicles each
month since November, before falling short in April as foreign
automakers reported lackluster results and sales to commercial
"This is the time of year when the automotive industry holds
its collective breath as the recent past has dealt with a spring
slowdown in demand; however, the current pace suggests full
steam ahead for the second half of 2013," LMC senior vice
president Jeff Schuster said in a statement. "Economic and
market headwinds have been minimized, while demand continues to
Auto sales are an early indicator each month of economic
health. The industry has so far proven stronger than the overall
U.S. economy. The record high age of cars and trucks on the road
has reached more than 11 years and easier availability of credit
has pushed consumers into the market.
"Stability in the industry is now the norm, which is a
positive for automakers as it results in the ability to optimize
production levels, therefore improving profitability," TrueCar
senior analyst Jesse Toprak said in a statement.
J.D. Power and LMC said retail sales, a more accurate
measure of underlying consumer demand, should top 1 million
vehicles for the third straight month with strong demand for
full-size pickup trucks again helping the final total.
The firms expect sales of the big trucks to account for 11.4
percent of industry retail sales in May, up from 11 percent in
April and 9.7 percent in May 2012. Full-size trucks generate
profits of more than $12,000 per vehicle, and that has mostly
benefited the U.S. automakers that dominate the segment.
The strong truck demand also is helping keep industry
average transaction prices at record levels, J.D. Power and LMC
said. The average transaction price for all new vehicles so far
in May is $28,921, helped by low interest rates.
Further helping companies' profits, TrueCar said the
industry's average incentive spending per vehicle fell 3 percent
in May to about $2,482.
TrueCar also expects U.S. sales in May for General Motors Co
and Ford Motor Co to rise 8.5 percent and 20.1
percent, respectively, while demand at Chrysler Group
should decline 6.2 percent. The research firm forecast sales for
Toyota Motor Corp, Honda Motor Co and Nissan
Motor Co to increase 5.1 percent, 6.8 percent and 25.4
The industry is scheduled to report May results on June 3.
In April, sales rose 8.5 percent.
Many executives and analysts have forecast 2013 U.S.
industry sales will finish in the 15 million to 15.5 million
range, up from 14.5 million last year. LMC expects 15.4 million.