June Sales Rate Could Reach 67-Month High

A WardsAuto forecast calls for the month’s SAAR to climb to 15.8 million light vehicles, the highest monthly rate since November 2007.

John Sousanis, Director, Information Content

June 21, 2013

2 Min Read
June Sales Rate Could Reach 67-Month High

Growing consumer confidence, pent-up demand and healthy inventories should help lift the U.S. light-vehicle market to a seasonally adjusted annual sales rate of 15.8 million units in June, WardsAuto forecasts.

That would mark the highest monthly rate since November 2007, when the SAAR topped 16 million units for the last time prior to the recession.

U.S. auto makers are expected to deliver 1.39 million cars and light trucks in the month, up 8.4% from like-2012. That’s equivalent to a 53,407-unit daily sales rate over 26 days, a 12.5% improvement from year-ago (27 days).

The forecast SAAR represents a 550,000-unit jump over the 15.2 million-unit average of the prior six months and reflects expectations retail sales will grow significantly in June.

The forecast does not indicate a boost in incentive spending by OEMs, but instead assumes a natural expansion of sales based on improving economic indicators, rising consumer confidence, the ongoing need to replace an aging fleet and the near-term demand for light trucks as new construction accelerates.

The Conference Board Consumer Confidence Index rose for the second month in May, reaching a 5-year peak, while the Thomson Reuters/University of Michigan Survey of Consumers reached its highest level since July 2007.

The 7.6% May unemployment rate marked a slight uptick from April’s 52-month low of 7.5%, while the U.S. Commerce Dept. reported retail spending accelerated from April to May. The spending rise was spurred by largely by auto sales, but also reflected a 0.3% gain from other sectors.

The Commerce Dept. reported, too, that new housing starts, a key indicator for light-truck sales in particular, rose to a 5-year high in May, while the National Association of Realtors reported ongoing growth in both unit sales and the median sales price of existing homes.

The expected rise in light-truck demand will help the Detroit Three auto makers grab a combined 46.9% of LV sales in June, compared with 45.9% the prior month.

The WardsAuto forecast calls for General Motors to claim nearly 19% of June LV sales on 262,000 deliveries, increasing daily volume 9.3% over year-ago. Ford should account for 16.6% of the market, with a 17.5% rise in DSR equating to 230,000 LVs.

Chrysler is expected to sell close to 160,000 units, for an 11.4% share and a 14.6% DSR gain.

Toyota will give back some of its 14.5% share of May sales, taking about 13.6% of the market in June on 188,000 deliveries. That will equate to a 9% month-to-month dip in daily sales that’s in line with seasonal trends and a 10% gain compared with year-ago.

Honda daily sales are forecast to rise 14.2% from same-month year-ago on 137,000 deliveries, giving the auto maker a 9.9% share, up slightly from May’s 9.7% take.

BMW is expected to lead all European auto makers with a 15.6% increase in its DSR.

The WardsAuto May forecast would bring year-to-date LV sales to 7.8 million units, a 7.3% improvement from like-2012.

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John Sousanis

Director, Information Content, WardsAuto

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