Forecast Calls for Strong June Sales

A new WardsAuto forecast calls for strong U.S. light-vehicle sales in June, with competition in the midsize car segment and healthy inventories across all segments fueling growth.

The report calls for 1.37 million LV deliveries this month, or a daily sales rate of 57,015 units (over 24 days), a 6% improvement over same-month year-ago (26 days).

The projected 16.4 million-unit seasonally adjusted annual rate would be less than May’s 87-month-high 16.7 million SAAR but just above the current 16.3 million-unit rolling 3-month SAAR.

The forecast 3.9% DSR decrease from May (27 days) would be an improvement over the -6.6% May-June change the industry has averaged over the past seven years.

Supporting the positive outlook are continued improvements in consumer confidence and labor statistics.

The Conference Board Consumer Confidence Index moved upward for a second consecutive month, reflecting optimism about the present situation as well as rising expectations. The Bureau of Labor Statistics reported 217,000 jobs added in May, maintaining a 5 1/2-year-low unemployment rate of 6.3%.

Sales should be bolstered by strong supply across all segments. While May’s high DSR dropped the industry month-end days’ supply to 60, continued strong production should lift stocks to a 64-days’ supply by the end of June.

The WardsAuto forecast calls for Detroit Three daily sales to climb 3.4% over year-ago, accounting for 45.5% of industry LV volume. General Motors is expected to sell 243,000 LVs, a 1% decline in DSR from year-ago. The projected 17.8% market share constitutes a 1 point share loss compared with year-ago.

Ford’s DSR, meanwhile, is projected to rise 1.6%, despite slowing F-Series sales, with the automaker delivering nearly 216,000 light vehicles for a 15.8% share.

Chrysler’s projected 12.7% DSR gain and 162,000 deliveries equate to an expected 11.9% share.

Asian automakers’ collective DSR is expected to rise nearly 12% over year-ago, on LV deliveries of 635,000 units. The strong performance reflects increased competition within the midsize car segment, supplemented by increased fleet-sale activity.

WardsAuto’s forecast calls for Toyota to claim 14.7% of LV sales with over 200,000 deliveries, an 11.9% improvement in daily sales, while Honda’s DSR is projected to rise more than 6%, accounting for 9.8% of the LV market.

The forecast also shows Hyundai-Kia and Nissan in a close race, with both automakers expected to sell more than 111,000 LVs this month, and each one grabbing in excess of 8% of the market.

European automakers could see daily sales fall 5.3% compared with same-month 2013.
Most automakers in the group are expected to boost or maintain their year-ago daily sales rates, but a projected 22% decline in Volkswagen brand sales dampens the overall outlook. On the brighter side, VW’s Audi brand is expected to see a 22.5% rise in daily sales this month.

At forecast levels, year-to-date sales through June would rise to 8.08 million units, up 3.7% over the first six months of 2013.

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