U.S. auto sales in March are shaping up to be disappointing from the industry’s point of view, but for consumers that’s good news because incentives are relatively high and likely to stay that way.
“We’re seeing a rebound but not the rebound I think everyone was hoping for,” said Eric Lyman, vice president for partner development and editorial for ALG Inc., Santa Barbara, Calif.
ALG sister company TrueCar Inc. estimated this week that U.S. auto sales in March were just under 1.5 million, an improvement of only around 1.8 percent from March 2013. Granted, that would be an improvement of around 24 percent from February 2014, the company said.
The closely watched Seasonally Adjusted Annual Rate for auto sales was an estimated 15.7 million, an increase of about 3 percent from a year ago, TrueCar said. That’s an estimate of sales for the full year, based on the March sales pace.
The upside for consumers is that incentives for March were the highest they’ve been since 2010, at an average of $2,773, according to TrueCar, based in Santa Monica, Calif.
TrueCar estimated that incentives averaged $3,719 for General Motors (Buick, Cadillac, Chevrolet, GMC); $3,349 for the Chrysler Group (Chrysler, Fiat, Dodge, Jeep, Ram truck); and $3,260 for Ford Motor Co. (Ford, Lincoln).
Estimated incentives were lower on average for biggest-volume Asian brands, with Nissan the highest, at $2,889, TrueCar said. Incentives were below industry average for Honda, Hyundai and Kia, and Toyota, the company said.
Analysts blamed unusually awful winter weather for lower-than-expected U.S. auto sales in January and February. The weather improved in March, but auto sales didn’t exactly roar back. The car companies are expected to report U.S. auto sales for March on Tuesday, April 1.
“When customers put off a purchase – say, because of the weather – they don’t necessarily go out the next sunny weekend and buy a car. It wasn’t reasonable to expect that all of the drop in sales that were blamed on the weather would be made up in March,” Lyman said.
“Positive momentum was expected,” he said. “But it wasn’t as high as everybody hoped for.”
Source: Forbes Auto