Ward’s is forecasting May U.S. light vehicle deliveries to total 856,000 units, up 5% from April on a daily rate basis (26 days both months) but still down 36% from year-ago levels, when the industry tallied 1.4 million units with just one additional sales day.
Related document: Ward’s U.S. Lt. Vehicle Sales and Inventory Forecast
A bump in daily sales from April to May has been a near-certain seasonal trend for more than a decade, the lone exception during that time occurring in 2002, when sales were flat over the 2-month period. Typically, May paces nearly 9% above April’s volume.
Motor Sales U.S.A. Inc. often leads the way, with nationwide sales and incentives regularly driving deliveries up well over 10% from April. Ward’s is forecasting a 14% jump this year.
That would give the auto maker 17% of the market, its highest share since January, but volume still would trail year-ago by 42% andwould underperform the market overall by more than 5%.
Historically,North America Inc. also has worked aggressively in May to move cars off dealer lots, with average month-to-month percentage gains from April in the high teens. In 2008, Nissan sales rose 28% from April to May, but this year look for a more modest 19% rise. That would be good for a 6.5% share of the market, but volume would trail year-ago by 42%.
AmericanMotor Co. Inc., which recently has tracked higher and had smaller fluctuations in daily sales vs. year ago than other volume sellers, should see a May-April gain of 6% and a relatively low 34% decline from year-ago.
The Detroit Three find themselves in highly volatile situations in May. The likelihoodCorp. will move into bankruptcy has shifted this month from probable to inevitable to imminent, according to many observers, and the auto maker already has announced plans to shut down its Pontiac brand by the end of 2010 and close or sell its Saturn and Hummer operations by the end of this year.
But whether consumers view these events as a reason to avoid GM dealers or as a potential to lock in on fire-sale bargains has yet to be demonstrated.
Further, GM’s recent monthly sales have leaned heavily on fleet deliveries (while other normally large-fleet sellers have not witnessed similar spikes), leading to questions about its ability to sustain its recent low, but steady sales rates. Ward’s is forecasting a 5% decline from April, leaving GM’s monthly sales 37% below like-2008.
LLC, in the midst of its first month in bankruptcy, also will shut down nearly 800 U.S. dealers by June 9. The move puts more than 40,000 vehicles in inventory at those dealerships into the market at presumably bargain-basement prices. Whether this fairly unprecedented event pulls sales ahead and draws customers away from competition or simply lowers transaction prices is a question that clouds the May and June sales outlooks.
Presumingends up tracking close to historical trends, daily sales should fall 7% from April and trail year-ago by more than 50%.
Motor Co. should be the big winner this month. Forecast to gain 7% on April results (not counting the possibility it will find its own cache of fleet sales soon), the auto maker likely will post an industry best 30% decline from year ago, with a daily rate of nearly 5,500 vehicles.
At forecast volumes, the industry seasonally adjusted annual rate would reach only 9.2 million units, marking the fifth consecutive month the SAAR has failed to hit 10 million and extending what already was the longest such streak since at least 1980.