Market Overview

TrueCar Finds July Auto Sales Simmer as Summer Heats Up and Slows Consumer Traffic

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

TrueCar, Inc. (NASDAQ: TRUE) projects total new vehicle sales, including fleet deliveries, will reach 1,505,200 units in July, down by 0.4 percent from a year ago.

That level of growth would push the seasonally adjusted annualized rate (SAAR) for total light vehicle sales to an estimated 17.7 million units for the month, up from a 17.6 million-unit SAAR a year ago. Excluding fleet sales, U.S. retail deliveries of new cars and light trucks should decline 0.7 percent to 1,318,200 units based on some soft spots in consumer demand.

"An exceptionally hot July has tempered retail sales with some consumers electing to stay indoors and off dealership showrooms," said Oliver Strauss, TrueCar's chief economist and forecaster. "However, a few automakers are experiencing mild retail growth. General Motors is offering a compelling summer sales event with vehicles up to 20 percent off MSRP, meanwhile Kia Motors America is offering zero percent financing for up to 66 months, both enticing consumers to battle the heatwaves."

Kia Motors America may report the biggest year-over-year retail sales gain, as it is currently on pace for a 7 percent rise in volume. GM will likely follow with a 2.9 percent retail sales increase. Nissan Motor Co. may post the third-biggest gains, with a 1 percent increase in retail sales.

Total volume for non-luxury, mass-market brands will likely be down by 0.4 percent versus last year, while sales of luxury models may decline by 0.6 percent. Both compact crossover and large utility vehicles remain in high-demand in July and will be among the industry's biggest volume segments.

Incentive spending by automakers averaged an estimated $3,225 per vehicle in July, up 5.2 percent from a year ago, though down 0.2 percent from June 2016.

"The most recent positive news about the U.S. labor market in combination with resilient consumer confidence continue to provide upbeat signals about the health of the U.S. economy," Strauss said. "Concerns in regards to "Brexit" and the outcome of the U.S. presidential election in November have perhaps taken a bit of a backseat. Yet the U.S. Fed remains cautious before possibly making an adjustment to the Federal Funds Rate. Overall, we remain optimistic that 2016 industry light vehicle sales will beat last year's performance."

The Conference Board Consumer Confidence Index is relatively unchanged in July at 97.3, down from 97.4 in June and overall U.S. economic conditions remain healthy. June's unemployment rate was 4.9 percent, the lowest for that month in eight years, while gasoline prices remain favorable for consumers, falling to a national average of $2.15 per gallon on July 26 from $2.72 a year earlier.

Other key findings for July:

  • Registration mix is expected to be 87.6 percent retail sales and 12.4 percent fleet versus 87.8 percent retail and 12.2 percent fleet last July.
  • Total used auto sales, including franchise and independent dealerships and private-party transactions, may reach 3,441,581, up 4 percent from July 2015.

Forecasts for the 12 largest manufacturers by volume:

Total Unit Sales

Manufacturer

   

July 2016 Forecast

   

July 2015

   

% Change vs.
July 2015
(Daily Selling Rate)

BMW     31,000     32,234     -3.8%
Daimler     30,200     30,131     0.2%
FCA     180,100     178,984     0.6%
Ford     223,300     222,014     0.6%
GM     272,000     272,512     -0.2%
Honda     145,800     146,324     -0.4%
Hyundai     69,700     71,013     -1.8%
Kia     61,700     56,311     9.6%
Nissan     133,800     130,872     2.2%
Subaru     48,000     50,517     -5.0%
Toyota     208,200     217,181     -4.1%
Volkswagen Group     48,800     53,982     -9.6%

Industry

   

1,505,200

   

1,511,261

   

-0.4%

           

Total Market Share

Manufacturer     July 2016 Forecast     July 2015     June 2016
BMW     2.1%     2.1%     2.2%
Daimler     2.0%     2.0%     2.1%
FCA     12.0%     11.8%     13.1%
Ford     14.8%     14.7%     15.8%
GM     18.1%     18.0%     16.9%
Honda     9.7%     9.7%     9.2%
Hyundai     4.6%     4.7%     4.5%
Kia     4.1%     3.7%     4.1%
Nissan     8.9%     8.7%     9.3%
Subaru     3.2%     3.3%     3.1%
Toyota     13.8%     14.4%     13.1%
Volkswagen Group     3.2%     3.6%     3.1%
           

Retail Unit Sales

Manufacturer

   

July 2016 Forecast

   

July 2015

   

% Change vs.
July 2015
(Daily Selling Rate)

BMW     30,000     31,816     -5.7%
Daimler     28,600     29,033     -1.5%
FCA     151,900     158,600     -4.2%
Ford     169,200     170,044     -0.5%
GM     231,600     224,984     2.9%
Honda     143,900     144,715     -0.6%
Hyundai     55,700     56,487     -1.4%
Kia     52,400     48,992     7.0%
Nissan     113,000     111,893     1.0%
Subaru     45,500     49,239     -7.6%
Toyota     201,700     203,392     -0.8%
Volkswagen Group     46,300     51,133     -9.5%

Industry

   

1,318,200

   

1,326,869

   

-0.7%

           

Incentive Spending

Manufacturer    

Incentive per Unit
July 2016
Forecast

   

Incentive per Unit
% Change vs.
July 2015

   

Incentive per Unit
% Change vs.
June 2016

   

Total Spending
July 2016 Forecast

BMW     $5,178     24.7%     -4.2%     $159,996,931
Daimler     $4,538     -5.1%     -4.4%     $137,034,668
FCA     $3,996     13.0%     -1.6%     $715,303,433
Ford     $3,632     20.3%     -1.3%     $811,080,602
GM     $4,338     1.9%     6.8%     $1,180,061,667
Honda     $1,794     -11.6%     4.3%     $261,611,907
Hyundai     $2,328     -12.7%     1.6%     $162,275,897
Kia     $2,699     -10.7%     -0.3%     $166,513,998
Nissan     $3,439     -3.9%     -0.4%     $460,085,014
Subaru     $644     -7.5%     1.9%     $30,898,070
Toyota     $2,228     4.7%     -2.7%     $463,765,798

Volkswagen Group

    $3,796     22.9%     0.0%     $184,122,187

Industry

   

$3,225

   

5.2%

   

-0.2%

   

$4,840,937,306

(Note: This forecast is based solely on TrueCar's analysis of industry sales trends and conditions and is not a projection of the company's operations.)

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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