September U.S. LV Sales Rebound Second Time in Four Months

U.S. light-vehicle sales in September continued an up-down trend that began in June, as the industry teeters on the brink of what likely is a downturn in demand after seven years of growth.

Overall, sales in the past four months averaged a 17.3 million-unit seasonally adjusted annual rate, but with a noticeable up-and-down pattern probably caused by manufacturers adjusting to stalled growth.

September’s 17.7 million-unit SAAR was well above August’s disappointingly low 16.9 million, which marked a big downturn from July’s 17.7 million, itself a rebound from June’s then-unexpectedly low 16.8 million.

However, September’s SAAR was below like-2015’s 18.0 million, while the 9-month 2016 total is flat with year-ago at 17.3 million.

Labor Day weekend marketing initiatives gave the month an early boost, but volume stayed relatively strong throughout the month. According to TrueCar, incentives as a percentage of average transaction prices, increased slightly to 10.2% in September from August’s 10.1%. In July, the ratio increased to 10.6% from June’s 9.8%.

Total volume for the month was 1.428 million units, 0.7% below year-ago’s 1.438 million units – both periods had 25 selling days.

If the 4-month pattern continues in October, and its SAAR falls well short of September’s and inventory levels remain above year-ago totals, expect a strong end of the year, with volumes gaining momentum in November that lasts into December. Furthermore, October’s SAAR also could fall off from September’s because it is the start of the ’17 model-year and automakers might want to test how well pricing holds up on their newer vehicles by decreasing incentive activity.

Based on WardsAuto estimates from publicly available data, September fleet deliveries increased from a year ago, while retail sales slipped for the second straight month and fifth time this year.

Demand for trucks, led by big jumps in Small CUVs, Small and Middle Luxury CUVs, Large and Luxury SUVs and Small Pickups, increased 3.8% over September 2015. Cars declined 7.2%, with every segment down from year-ago.

Sales of imported LVs, due mostly to Small and Middle Luxury CUVs, increased 2.6% and market penetration was 21.3%, compared with year-ago’s 20.6%. Domestically made LVs were down 1.6%.

Despite the industry shortfall, several automakers outsold year-ago, including Daimler, Hyundai, Jaguar Land Rover, Nissan, Porsche, Subaru, Tesla, Toyota and Volvo. Except Toyota, year-to-date volumes for all the aforementioned also are above year-ago.

Toyota’s increase reversed a string of six straight losses, and included big gains in CUVs, SUVs and pickups, as well as a 17.0% jump in Toyota Corolla small-car deliveries, although the automaker’s year-to-date volume remains down.

Nissan resumed growth after a year-over-year decline in August that broke a string of 41 straight increases. Nissan’s September volume rose 4.9%, and its year-to-date total is 5.4% higher than a year ago. Year-to-date market share of 9.1% is well above like-2015’s 8.6%. The automaker’s rebound was rooted in CUVs and Infiniti brand cars and trucks. Pickups also posted big gains, but most significant was the redesigned Nissan Titan fullsize pickup picking up steam, with deliveries of 2,484 units, its highest monthly total in eight years and 130% above like-2015.

Somewhat surprising among the majors was Honda’s third (albeit small) year-over-year decline in the past four months. Honda was riding a string of strong year-over-year increases from September 2015 through May, thanks to fresh product on dealer lots. But downturns by the Accord and its Acura luxury brand have offset gains by the newer products.

Although it was flat with year-ago at 17.5%, General Motors for the first time since October 2015 did not post a year-over-year market-share loss. Ironically, GM’s cars – not trucks – propped up share, thanks in large part to newly refreshed models such as the Chevrolet Cruze, Malibu, Volt and Cadillac CT6.

GM’s truck volume was down 4.6%, despite huge gains for its SUVs and Small Pickups. GM’s Large pickups declined 13.7% and its CUVs combined for a 12.9% loss from year-ago.

Similarly to GM, sales of Ford’s F-Series fullsize pickups also declined (-3.4%), while FCA US Ram pickup volume surged 29.2%.

Among the other automakers, September year-over-year losses were incurred by BMW (-5.2%), Kia (-1.2%), Mazda (-2.8%), Mitsubishi (-4.8%) and Volkswagen/Audi (-4.0%).

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