TrueCar Sees May Auto Sales Reaching $51.7 Billion

TrueCar, Inc. TRUE disclosed Wednesday that it expects new vehicles sales generated $51.7 billion in May in the United States. That meant sales were down 0.8 percent from a year ago due to the absence of one less full weekend for car buying compared with the year-ago month.

TrueCar said stronger average transaction prices weren't enough to help automakers post a 29th straight month of revenue increases last month as the value of new vehicle sales dipped to $399.5 million from the previous year month.

The company said that incentive spending likely increased an estimated 7.1 percent from the preceding year month. As announced earlier, it expects sales of new cars and light trucks fell 4 percent last month to about 1.57 million units.

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

Similarly, its Chief Economist, Oliver Strauss, said, "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. 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."

TrueCar also expects the average transaction price (ATP) for a new light vehicle was $32,944 in May, up 3.4 percent on a year-over-year basis. Similarly, average incentive spending per unit also grew by $200 to $3,034. The company indicated that the ratio of incentive spending to ATP was 9.2 percent compared to 8.9 percent a year ago.

On Tuesday, the stock traded 2.15 percent higher.