Market Overview

February Auto Sales Expected to Remain Steady

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ALG,
the industry benchmark for determining the future resale value of a
vehicle, projects total new vehicle sales, including fleet deliveries,
will reach 1,325,000 units in February, down 1.4 percent from a year ago.

This month's seasonally adjusted annualized rate (SAAR) for total light
vehicle sales is an estimated 17.45 million units for the month, down
from a 17.69 million-unit SAAR a year ago. Excluding fleet sales, U.S.
retail deliveries of new cars and light trucks should remain flat with
1,039,299 units.

"Retail sales are flat, but the collective reduction on fleet sales is
leading to year-over-year declines," said Eric Lyman, ALG's chief
industry analyst. "Disciplined fleet and inventory management are
positive signs for the industry. The modest drop in sales is a byproduct
of the medicine the industry needs to take to sustain a healthy balance
between inventory and demand."

Incentive spending by automakers averaged an estimated $3,443 per
vehicle in February, up 13.5 percent from a year ago, and down 0.8
percent from January 2017.

"Look for incentives to decline to more manageable levels in Q2 as
pullbacks in production lead to right size inventory on dealer lots,"
said Lyman.

The
University of Michigan's Index of Consumer Sentiment
is at 96.3 this
month compared to 98.5 in January. While slightly below last month, the
Sentiment Index continues to signal the strength of a healthy U.S.
economy. The January unemployment
rate
came in at a nine year low of 4.8 percent in combination with a
favorable average gas price of $2.29
recorded for this current week.

Other key findings for February:

  • Registration mix is expected to be 78.4 percent retail sales and 21.6
    percent fleet versus 77.3 percent retail and 22.7 percent fleet last
    February.
  • Total used auto sales, including franchise and independent dealerships
    and private-party transactions, may reach 3,167,780, up 7.9 percent
    from February 2016.
 

Forecasts for the 12 largest manufacturers by volume:

Total Unit Sales

 

Manufacturer

 

February

2017 Forecast

 

February 2016

 

% Change vs.

February 2016

BMW   25,500   25,414   0.3 %
Daimler   27,500   25,632   7.3 %
FCA   165,000   183,607   -10.1 %
Ford   207,000   216,045   -4.2 %
GM   230,500   227,825   1.2 %
Honda   122,000   118,985   2.5 %
Hyundai   52,000   53,009   -1.9 %
Kia   45,000   49,737   -9.5 %
Nissan   124,000   130,911   -5.3 %
Subaru   46,000   42,011   9.5 %
Toyota   185,000   187,954   -1.6 %
Volkswagen Group   43,500   37,747   15.2 %

Industry

 

1,325,000

 

1,344,225

 

-1.4

%

     
 

Total Market Share

 
Manufacturer   February 2017 Forecast   February 2016   January 2017
BMW   1.9 %   1.9 %   1.9 %
Daimler   2.1 %   1.9 %   2.4 %
FCA   12.5 %   13.7 %   13.4 %
Ford   15.6 %   16.1 %   15.0 %
GM   17.4 %   16.9 %   17.1 %
Honda   9.2 %   8.9 %   9.3 %
Hyundai   3.9 %   3.9 %   3.9 %
Kia   3.4 %   3.7 %   3.1 %
Nissan   9.4 %   9.7 %   9.8 %
Subaru   3.5 %   3.1 %   3.8 %
Toyota   14.0 %   14.0 %   12.5 %
Volkswagen Group   3.3 %   2.8 %   3.6 %
     
 

Retail Unit Sales

 

Manufacturer

 

February 2017
Forecast

 

February 2016

 

YoY % Change

BMW   23,900   24,073   -0.7 %
Daimler   25,500   23,625   7.9 %
FCA   122,500   126,514   -3.2 %
Ford   134,500   133,616   0.7 %
GM   177,750   177,924   -0.1 %
Honda   120,500   117,379   2.7 %
Hyundai   35,485   34,330   3.4 %
Kia   33,015   41,073   -19.6 %
Nissan   87,000   88,715   -1.9 %
Subaru   43,500   40,353   7.8 %
Toyota   154,250   156,911   -1.7 %
Volkswagen Group   36,900   33,143   11.3 %

Industry

 

1,039,299

 

1,038,696

 

0.1

%

     
 

Incentive Spending

 
Manufacturer  

Incentive
per Unit
Feb 2017

Forecast

 

Incentive
per Unit
Feb 2016

 

Incentive
per Unit Jan
2017

 

Incentive
per Unit
%
Change

vs. Feb
2016

 

Incentive
per Unit
%
Change

vs. Jan
2017

 

Total Spending
Feb 2017
Forecast

BMW   $ 4,450   $ 4,584   $ 4,032   -2.9 %   10.4 %   $ 113,163,241
Daimler   $ 4,415   $ 3,754   $ 4,465   17.6 %   -1.1 %   $ 121,413,963
FCA   $ 4,187   $ 3,916   $ 4,219   6.9 %   -0.8 %   $ 686,249,164
Ford   $ 4,096   $ 3,317   $ 4,144   23.5 %   -1.1 %   $ 847,959,642
GM   $ 4,547   $ 4,022   $ 4,587   13.0 %   -0.9 %   $ 1,047,996,755
Honda   $ 2,168   $ 1,490   $ 2,095   45.5 %   3.5 %   $ 264,536,790
Hyundai   $ 2,182   $ 2,099   $ 2,176   3.9 %   0.3 %   $ 113,456,413
Kia   $ 3,383   $ 2,872   $ 3,366   17.8 %   0.5 %   $ 152,216,510
Nissan   $ 3,975   $ 3,396   $ 3,993   17.1 %   -0.4 %   $ 492,939,580
Subaru   $ 896   $ 557   $ 966   60.9 %   -7.2 %   $ 41,221,553
Toyota   $ 2,155   $ 2,102   $ 2,212   2.5 %   -2.6 %   $ 398,685,309
Volkswagen Group   $ 3,466   $ 3,386   $ 3,418   2.4 %   1.4 %   $ 150,163,698

Industry

 

$

3,443

 

$

3,034

 

$

3,472

 

13.5

%

 

-0.8

%

 

$

4,545,210,258

 

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

About ALG

Founded in 1964 and headquartered in Santa Monica, California, ALG is an
industry authority on automotive residual value projections in both the
United States and Canada. By analyzing nearly 2,500 vehicle trims each
year to assess residual value, ALG provides auto industry and financial
services clients with market industry insights, residual value
forecasts, consulting and vehicle portfolio management and risk
services. ALG is a wholly-owned subsidiary of TrueCar, Inc., a digital
automotive marketplace that provides comprehensive pricing transparency
about what other people paid for their cars. ALG has been publishing
residual values for all cars, trucks and SUVs in the U.S. for over 50
years and in Canada since 1981.

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