Market Overview

May Auto Sales Revenue Set to Reach $51.7 Billion

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SANTA MONICA, Calif.--(BUSINESS WIRE)--

TrueCar, Inc. (NASDAQ: TRUE) estimates that U.S. new vehicle sales generated $51.7 billion in May, down 0.8 percent from a year ago owing to the absence of one less full weekend for car buying compared with May 2015.

Stronger average transaction prices last month weren't enough to help automakers post a 29th consecutive month of revenue increases, with the value of new vehicle sales dipping $399.5 million compared with the year-ago month. Incentive spending likely increased an estimated 7.1 percent from a year ago. As previously announced, TrueCar estimates sales of new cars and light trucks decreased by 4 percent last month to 1,569,538 units.

"Industry revenue is likely to be somewhat constrained by the calendar this May even as the summer-selling season kicks in," said Eric Lyman, TrueCar's vice president of industry insights. "The fact that average transaction prices are still edging up underscores continuing health in demand for new cars and trucks."

TrueCar estimates the average transaction price (ATP) for a new light vehicle was $32,944 in May, up 3.4 percent from a year ago. Average incentive spending per unit rose by $200 to $3,034. The ratio of incentive spending to ATP was 9.2 percent, up from 8.9 percent a year ago.

"Incentives as a percentage of average transaction price are up but only modestly from a year ago, which is a sign that automakers are still maintaining a relatively healthy approach to such spending," said Oliver Strauss, TrueCar's chief economist. "The sustained health of the U.S. economy and consumers' needs to replace aging vehicles could put total sales near the 18 million mark for 2016."

Table 1. Average transaction price

Manufacturer

     

May 2016

Forecast

     

May 2015

     

April 2016

     

Change vs.

May 2015

     

Change vs.

April 2016

FCA (Chrysler, Dodge, Jeep, Ram, Fiat)       $33,168       $32,680       $33,532       1.5%       -1.1%
Ford (Ford, Lincoln)       $34,904       $33,281       $35,276       4.9%       -1.1%
GM (Buick, Cadillac, Chevrolet, GMC)       $36,810       $34,224       $36,857       7.6%       -0.1%
Honda (Acura, Honda)       $27,096       $27,165       $27,727       -0.3%       -2.3%
Hyundai       $22,936       $23,249       $22,822       -1.3%       0.5%
Kia       $23,641       $23,594       $23,717       0.2%       -0.3%
Nissan (Nissan, Infiniti)       $27,416       $27,202       $27,239       0.8%       0.6%
Subaru       $27,232       $27,001       $27,539       0.9%       -1.1%
Toyota (Lexus, Scion, Toyota)       $31,310       $30,022       $31,275       4.3%       0.1%
Volkswagen (Audi, Porsche, Volkswagen)       $40,391       $39,126       $40,343       3.2%       0.1%

Industry

     

$32,944

     

$31,868

     

$33,012

     

3.4%

     

-0.2%

                             

TrueCar estimates the average incentive for light vehicles in May will rise by $200, or 7.1 percent, from a year ago, and shrink by $12, or -0.4 percent, from April 2016.

Table 2. Incentive Spending

Manufacturer

     

Incentive per

Unit May 2016

Forecast

     

Incentive per Unit

% Change vs. May

2015

     

Incentive per Unit

% Change vs. Apr

2016

     

Total Spending May

2016 Forecast

BMW       $4,978       9.0%       -5.9%       $172,055,775
Daimler       $4,024       -6.1%       0.6%       $127,813,358
FCA       $3,926       19.8%       -1.4%       $809,038,347
Ford       $3,433       28.4%       -2.3%       $815,320,985
GM       $3,941       4.7%       -1.8%       $1,063,644,940
Honda       $1,635       -15.7%       1.9%       $249,063,486
Hyundai       $2,032       -12.8%       1.2%       $127,940,407
Kia       $2,715       -0.3%       -0.2%       $165,463,033
Nissan       $3,342       -2.1%       3.4%       $448,764,037
Subaru       $612       -18.5%       2.8%       $29,939,793
Toyota       $2,029       0.4%       1.6%       $453,431,066
Volkswagen Group       $3,448       17.0%       0.1%       $181,318,261

Industry

     

$3,034

     

7.1%

     

-0.4%

     

$4,762,348,142

                       

This month's ratio of incentive to ATP for light vehicles was 9.2 percent, up from 8.9 percent in May 2015 and unchanged 9.2 percent in April 2016, based on TrueCar analysis. Honda, Hyundai, Nissan, Subaru and GM showed the most improvement in ATP ratio in May versus the year-earlier month.

Table 3. Incentive Spending as a Percentage of ATP

Manufacturer

         

May 2016

Forecast

         

May 2015

         

April 2016

BMW (BMW, Mini)           9.3%           8.8%           10.3%
Daimler (Mercedes-Benz, Smart)           6.7%           7.5%           6.6%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat)           11.8%           10.0%           11.9%
Ford (Ford, Lincoln)           9.8%           8.0%           10.0%
GM (Buick, Cadillac, Chevrolet, GMC)           10.7%           11.0%           10.9%
Honda (Acura, Honda)           6.0%           7.1%           5.8%
Hyundai           8.9%           10.0%           8.8%
Kia           11.5%           11.5%           11.5%
Nissan (Nissan, Infiniti)           12.2%           12.6%           11.9%
Subaru           2.2%           2.8%           2.2%
Toyota (Lexus, Scion, Toyota)           6.5%           6.7%           6.4%
Volkswagen (Audi, Porsche, Volkswagen)           8.5%           7.5%           8.5%

Industry

         

9.2%

         

8.9%

         

9.2%

                             

About TrueCar

TrueCar, Inc. (NASDAQ: TRUE) is a digital automotive marketplace that provides comprehensive pricing transparency about what other people paid for their cars and enables consumers to engage with TrueCar Certified Dealers who are committed to providing a superior purchase experience. TrueCar operates its own branded site and its nationwide network of more than 11,000 Certified Dealers also powers car-buying programs for some of the largest U.S. membership and service organizations, including USAA, AARP, American Express, AAA and Sam's Club. Over one third of all new car buyers engage with the TrueCar network during their purchasing process. TrueCar is headquartered in Santa Monica, California, with offices in San Francisco and Austin, Texas. For more information, go to www.truecar.com. Follow us on Facebook or Twitter.

TrueCar media line: +1-844-469-8442 (US toll-free) | Email: pressinquiries@truecar.com

TrueCar, Inc.
Veronica Cardenas, 424-258-2487
VCardenas@truecar.com
pressinquiries@truecar.com


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