U.S. new-vehicle sales this month, fueled by higher incentives, are expected to roughly match the levels of January 2017, but the selling rate is projected to decline as the industry prepares for a second straight year of lower volume.
This story by Michael Martinez originally appeared in Automotive News.
Forecasts from Cox Automotive and LMC/J.D. Power call for sales to rise about 1 percent year over year, while Edmunds projects a 1.4 percent decline.
All three forecasts call for sales of around 1.1 million vehicles. Cox and LMC/J.D. Power say that will result in a seasonally adjusted annual rate of sales of 17.1 million vehicles, while Edmunds forecasts a 16.7 million SAAR. Both figures are below the January 2017 rate of 17.43 million.
January is typically the lowest-volume month of the year. This month, lower-than-normal temperatures in much of the country kept buyers indoors.
Although volumes are about the same as a year ago, analysts say customers are buying more expensive vehicles, driven by continued demand for higher-priced pickups and SUVs. Automakers are scheduled to report January sales on Thursday.
LMC and J.D. Power said consumers were on pace to spend $28.8 billion on new vehicles in January, just more than $1 billion above last year’s level. They said the average new-vehicle retail transaction price in the first 16 selling days of the month was a record $32,169, topping the previous high for the month of $31,422 set a year ago.