Edmunds.com: Industry could have best June sales in 10 years

SANTA MONICA, Calif. — Edmunds.com, the premier destination for car shopping, forecasts that 1,484,487 new cars and trucks will be sold in the U.S. in June for an estimated Seasonally Adjusted Annual Rate (SAAR) of 17.3 million. The projected sales will be a 9.0 percent decrease from May 2015, but a 4.7 percent increase from June 2014. If the sales volume holds, it will mark the best-selling month of June since 2006, and the biggest June SAAR since 2005.

“The auto industry has maintained most of the strength it flexed during its record-breaking May,” said Edmunds.com Director of Industry Analysis Jessica Caldwell. “In many parts of the country we saw May’s deal offers extend well into June, and Fourth of July promotions should start as early as next week. These sales messages are helping to sustain the industry’s momentum into the first few weeks of summer.”

Edmunds.com estimates that retail SAAR will come in at 14.1 million vehicles in June, with fleet transactions accounting for 18.3 percent of total sales. An estimated 2.98 million used cars will be sold in June, for a SAAR of 37.2 million (compared to 3.07 million – or a SAAR of 37.4 million – used car sales in May).

What economic factors are driving today’s heavy volume of shoppers to dealer showrooms? Edmunds.com Chief Economist Dr. Lacey Plache explains what car shoppers want at http://www.edmunds.com/industry-center/analysis/what-car-shoppers-want-now.html.

It ain’t easy being green: Hybrid, electric cars traded for SUVs

Even though it was Kermit the Frog who sang “it ain’t easy being green,” it appears that eco-friendly car owners are ditching their hybrid and electric vehicles for SUVs at a higher rate than ever before, according to Edmunds.com.

Not surprisingly, financial matters seem to figure into the motives, according to  Jessica Caldwell, Edmunds.com’s Director of Industry Analysis. “For better or worse, it looks like many hybrid and EV owners are driven more by financial motives rather than a responsibility to the environment.”

The analysis offers a surprising look at how today’s gas prices are drawing hybrid and EV owners toward gas-guzzling vehicles at a much more accelerated pace than in recent years.

According to Edmunds.com, about 22 percent of people who have traded in their hybrids and EVs in 2015 bought a new SUV. The number represents a sharp increase from 18.8 percent last year, and it is nearly double the rate of 11.9 percent just three years ago. Overall, only 45 percent of this year’s hybrid and EV trade-ins have gone toward the purchase of another alternative fuel vehicle, down from just over 60 percent in 2012. Never before have loyalty rates for alt-fuel vehicles fallen below 50 percent.

“Three years ago, when gas was at near-record highs, it was a lot easier to rationalize the price premiums on alternative fuel vehicles. But with today’s gas prices as low as they are, the math just doesn’t make a very compelling case,” Caldwell said.

To underscore the point, Edmunds calculates that at the peak average national gas price of $4.67/gallon in October 2012, it would take five years to break even on the $3,770 price difference between a Toyota Camry LE Hybrid ($28,230) and a Toyota Camry LE ($24,460). At today’s national average gas price of $2.27/gallon, it would take twice as much time (10.5 years) to close the same gap.

Edmunds’ analysis comes at a time when overall sales of alternative vehicles have continued to slide. EVs and hybrids accounted for just 2.7 percent of all new car sales in the first quarter of 2015, down from 3.3 percent during that same period last year. The share of SUVs, meanwhile, has increased from 31.8 percent in Q1 2014 to 34.2 percent in Q1 2015.

Shoppers who want to learn more about hybrid and electric vehicles on today’s new and used market are encouraged to visit Edmunds.com at http://www.edmunds.com/hybrid/. Shoppers can also calculate “breakeven” times using Edmunds’ Gas Guzzler Calculator at http://www.edmunds.com/calculators/gas-guzzler.html?sv.

 

 

A look at the New Year by Jessica Caldwell at Edmunds.com

At Edmunds.com, their analysts have been making their spreadsheets and checking them twice, and they’ve come up with some great year-end insights. OK, Jessica Caldwell, Senior Analyst for car-shopping website Edmunds.com has the folllowinng insights for the forward-looking automotive world.
– Light trucks will outsell cars for the year for the first time since 2011.
The last time light trucks outsold cars every month of the year was 2004. This increase in truck sales is partly due to the fact that crossover SUVs have skyrocketed in popularity, becoming the fourth biggest segment in terms of sales volume. See http://static.ed.edmunds-media.com/unversioned/img/industry-center/analysis/key.insights.compact.suv.pdf for more analysis of the crossover SUV segment.
-Shoppers are tending to buy more expensive vehicles these days, as low gas prices, a record stock market and the improving economy are making people feel more financially comfortable. In 2013, total U.S. spending on new cars was $90.8 billion; in 2014 that number is expected to rise to approximately $100 billion.
At http://static.ed.edmunds-media.com/unversioned/img/industry-center/analysis/121714-luxury-sales.pdf you can see the team’s analysis of the luxury market, including the following points:
-Not including leases, the average monthly payment for a luxury car is $710; for a non-luxury car it is $462.
-In 2014, luxury segments made up 11% of new car sales volume and 18% of new car spending.
Not everyone who trades in a luxury vehicle buys another one. So far this calendar year, Porsche, Lexus and Audi traders have proven most likely to get another luxury vehicle; Lincoln, Volvo and Infiniti traders are least likely to get another luxury vehicle.

 

Tesla S sells well in 8 of the top 25 zip codes: Edmunds.com

Tesla S

Tesla S

BY GERRY MILES

It may well be the new “must have” car for those who must have and can have it all in 8 of America’s 25 toniest zip codes, according to Edmunds.com, out-selling its competitors.

Edmunds’ analysis is based upon new car registration data from Polk, showing the 8 area codes that sell the most are in California. Not surprisingly, the town next to Tesla’s Palo Alta HQ, Atherton, shows 15.4 percent of all new cars are the Model S. Palo Alto headquarters, is the wealthiest zip code in America, with a median home price of $6,665,000.

While having the must have and early adopter exclusive car is nice, Jessica Caldwell says the data provides a bit of why it appeals to buyers.

“It’s a classic pattern for any retail product, including cars: the wealthy and influential buyers set a trend, and the mainstream aspires to follow,” says Edmunds.com Sr. Analyst Jessica Caldwell. “As Tesla increases the number of models and improves its price points, it could find itself in demand by more than just those in these wealthy enclaves. After all, luxury car companies typically find the most volume in their entry-level vehicles.”

In May, Tesla CEO Elon Musk shared that he hopes to offer a vehicle to car shoppers for under $40,000 within the next four years.

California’s sunny skies may also make it appealing, but nationally the Model S market share sits at just 0.1 percent.  Edmunds.com’s analysis found that Tesla’s market share exceeds 1.0 percent in only one of the non-California zip codes ranked in the top 25 by Forbes (#19 Water Mill, NY with 1.2% of all new car registrations in 2013, through August). The Model S national market share sits at just 0.1 percent.

Jessica Caldwell (@jessrcaldwell) offers more insight into Tesla’s class of affluent buyers in Edmunds.com’s Industry Center at http://www.edmunds.com/industry-center/analysis/drive-by-numbers-tesla-model-s-is-the-vehicle-of-choice-in-many-of-americas-wealthiest-zip-codes.html.

Edmunds.com: Gov’t shutdown didn’t stall October auto sales

press release from edmunds.com

SANTA MONICA, Calif. — October 24, 2013 — Edmunds.com, the premier resource for car shopping and automotive information, forecasts that 1,229,860 new cars and trucks will be sold in the U.S. in October for an estimated Seasonally Adjusted Annual Rate (SAAR) of 15.5 millionThe projected sales will be an 8.2 percent increase from September 2013, and a 12.7 percent increase from October 2012.

The overall sales projections suggest that the government shutdown earlier this month had minimal effect on auto sales. But, says Edmunds.com, a longer shutdown could have left an ugly mark on what has been otherwise a glowing year for the automotive industry.

“It looks like the government shutdown ended just in the nick of time,” says Edmunds.com Senior Analyst Jessica Caldwell. “The week-by-week data suggests that consumers started to get jittery by the middle of the month. But with the government back to work, most lost sales should be made up in the latter half of the month, and the industry’s momentum will continue the pace it enjoyed before the disruption in Washington.”

SALES VOLUME FORECAST, BY MANUFACTURER

Sales Volume

Oct-13 Forecast

Oct-12

Sep-13

Change from Oct 2012*

Change from Sep 2013*

GM

215,274

195,764

187,195

10.0%

15.0%

Ford

193,988

167,947

184,452

15.5%

5.2%

Toyota

178,828

155,242

164,457

15.2%

8.7%

Chrysler Group

139,848

126,185

143,017

10.8%

-2.2%

Honda

120,484

106,973

105,563

12.6%

14.1%

Hyundai/Kia

95,786

92,723

93,105

3.3%

2.9%

Nissan

94,492

79,685

86,868

18.6%

8.8%

VW/Audi

46,798

46,019

44,985

1.7%

4.0%

Industry

1,229,860

1,091,546

1,136,218

12.7%

8.2%

*NOTE: Oct. 2013 had 27 selling days, Oct. 2012 had 26 and Sept. 2013 had 23.

Edmunds.com estimates that retail SAAR will come in at 13.0 million vehicles in October, with fleet transactions accounting for 16.0 percent of total sales. An estimated 3.06 million used cars will be sold in October, for a SAAR of 35.6 million (compared to 3.02 million – or a SAAR of 36.3 million – used car sales in September).

AUTOMAKER PERFORMANCE

While most major automakers are expected to easily clear September’s sales totals, Edmunds.com projects that Chrysler sales will fall 2.2 percent month to month. As a result, Edmunds.com expects that the company’s market share will recede 1.2 percentage points in October, just one month after it hit its highest share in over five years.

MARKET SHARE FORECAST, BY MANUFACTURER

Market Share

Oct-13 Forecast

Oct-12

Sep-13

Change from
October 2012
(Percentage pts.)

Change from September 2013
(Percentage pts.)

GM

17.5%

17.9%

16.5%

-0.4%

1.0%

Ford

15.8%

15.4%

16.2%

0.4%

-0.5%

Toyota

14.5%

14.2%

14.5%

0.3%

0.1%

Chrysler Group

11.4%

11.6%

12.6%

-0.2%

-1.2%

Honda

9.8%

9.8%

9.3%

0.0%

0.5%

Hyundai/Kia

7.8%

8.5%

8.2%

-0.7%

-0.4%

Nissan

7.7%

7.3%

7.6%

0.4%

0.0%

VW/Audi

3.8%

4.2%

4.0%

-0.4%

-0.2%

General Motors, meanwhile, is expected to create a little breathing room at the top of the sales standings. Edmunds.com projects that GM sales will increase 15 percent from September to October, outpacing top rival Ford’s growth of 5.2 percent. In September, Ford finished within almost 3,000 sales of GM’s total, and nearly claimed its first head-to-head victory since March 2011.

More insight into recent auto industry trends can be found in Edmunds.com’s Industry Center at http://www.edmunds.com/industry-center/.

Dog days of summer are when the best car deals heat up

“Shoppers typically will find the perfect blend of discounts during late-August-to-September,” says Edmunds.com Sr. Analyst Jessica Caldwell. “If they wait much longer, they might be able to find better discounts on a new car, but that inventory of those vehicles will be limited.”

BY GERRY MILES

The weather in the coming weeks may make you sweat, during the stereotypical dog days of summer, but car shoppers should sweat the details to get a sweet deal on a new car, according to Edmunds.com.

The reason, says Edmunds, is as temperatures climb – I don’t think global warming has any correlation here – dealers heat up the deal to push the 2013 model leftovers out to make room for new 2014 inventory.

What are the very best deals available on the market right now? Edmunds.com identifies the top new car deals on its Deals of the Month page at: http://www.edmunds.com/deals-of-month.html.

This month’s list includes the:

“Shoppers typically will find the perfect blend of discounts and selection during this late-August-to-September time period,” says Edmunds.com Sr. Analyst Jessica Caldwell. “If they wait much longer, they might be able to find better discounts on a new car, but they’ll find that inventory of those vehicles will be limited.”

Edmunds.com’s recommendation applies specifically to 2013 model year vehicles, which carry bigger discount percentages than all-new 2014 models.

Last month for example, the average discount percentage on a brand new 2013 vehicle was 12.7%, compared to a discount percentage of just 7.7% for a new 2014 vehicle. As a result, Edmunds.com projects that most new cars sold through September will be 2013 models. As 2013 inventories dry up, the proportion of 2014 model-year sales will likely catch up in mid-to-late October.

Some veteran buyers insist that shoppers can maximize discounts early in the week or in the last days of the month.

Edmunds.com examines the various philosophies behind the best days and times to buy a car at http://www.edmunds.com/car-buying/when-to-buy-your-next-car.html.

Fewer fleet sales drives best car sales since 2006: Edmunds.com

BY GERRY MILES

Fewer fleet sales combined with stronger retail sales result in a July forecast from Edmunds.com that 1,328,397 new cars and trucks will be sold this month. The estimated Seasonally Adjusted Annual Rate (SAAR) for the year is 15.8 million. The projected sales will be a 5.3 percent decrease from June 2013 via a month vs. month comparison, but more importantly it will show a whopping 15.2 percent increase from July 2012 in a year over year comparison.

Edmunds.com anticipates that this month will be the biggest July performance since 2006 when automakers sold 1,489,359 vehicles.

 “What makes July truly impressive is that fleet sales are so low,” says Edmunds.com Senior Analyst Jessica Caldwell. “That means retail sales are stepping up as the driving force for the auto industry. When people jump back into the market, it’s great news not just for the automotive sector, but for the entire U.S. economy.”

SALES VOLUME FORECAST, BY MANUFACTURER

Sales Volume

Jul-13 Forecast

Jul-12

Jun-13

Change from Jul 2012*

Change from Jun 2013*

GM

239,972

201,237

264,843

19.2%

-9.4%

Toyota

199,716

164,898

195,235

21.1%

2.3%

Ford

193,914

173,482

234,917

11.8%

-17.5%

Chrysler Group

140,160

126,089

156,686

11.2%

-10.5%

Honda

134,429

116,944

136,915

15.0%

-1.8%

Hyundai/Kia

117,354

110,095

115,543

6.6%

1.6%

Nissan

115,697

98,341

104,124

17.6%

11.1%

VW/Audi

48,272

48,721

50,663

-0.9%

-4.7%

Industry

1,328,397

1,153,092

1,402,274

15.2%

-5.3%

*NOTE: July 2013 had 25 selling days, July 2012 had 24 and June 2013 had 26.

 Edmunds.com estimates that retail SAAR will come in at 13.6 million vehicles in July, with fleet transactions accounting for 14 percent of total sales, the lowest proportion for any month this year. An estimated 3.18 million used cars will be sold in July, for a SAAR of 36.2 million (compared to 3.07 million – or a SAAR of 37.1 million – used car sales in June).

AUTOMAKER PERFORMANCE

In a bit of a surprise, Edmunds.com projects that Toyota will beat Ford in total sales this month, the first time since March 2010. The Japanese automaker will claim 15.0 percent of U.S. auto sales in July, its highest share since January 2013. Ford’s share, meanwhile, is expected to fall 2.2 percentage points from June, the biggest month-to-month decrease of any automaker. Its projected 14.6 percent share this month will be the company’s lowest single-month share since August 2009 (14.3 percent).

 MARKET SHARE FORECAST, BY MANUFACTURER

Market Share

Jul-13 Forecast

Jul-12

Jun-13

Change from
July 2012
(Percentage pts.)

Change from
June 2013
(Percentage pts.)

GM

18.1%

17.5%

18.9%

0.6%

-0.8%

Toyota

15.0%

14.3%

13.9%

0.7%

1.1%

Ford

14.6%

15.0%

16.8%

-0.4%

-2.2%

Chrysler Group

10.6%

10.9%

11.2%

-0.4%

-0.6%

Honda

10.1%

10.1%

9.8%

0.0%

0.4%

Hyundai/Kia

8.8%

9.5%

8.2%

-0.7%

0.6%

Nissan

8.7%

8.5%

7.4%

0.2%

1.3%

VW/Audi

3.6%

4.2%

3.6%

-0.6%

0.0%

More insight into recent auto industry trends can be found in Edmunds.com’s Industry Center at http://www.edmunds.com/industry-center/.