As US light vehicles sales topped 17 million in 2019 for the 5th consecutive year, Chris Hopson takes a look at the… https://t.co/YWcwD6o06a
US light-vehicle sales decline 2.3% y/y in April
The light-vehicle sales volume dropped 2.3% year on year (y/y) in the United States in April, while in the year to date (YTD), sales are down 3.0% y/y. In April, light truck sales increased 2.5% y/y and passenger-car sales dropped 7.7% y/y. The estimated seasonally adjusted annual rate (SAAR) of US light-vehicle sales was 16.41 million units in April. Please note that all industry-level figures in this article are estimates owing to the absence of official monthly sales results from General Motors and Ford.
Outlook and implications
With an estimated seasonally adjusted annual rate (SAAR) of 16.41 million units, US light-vehicle sales demand in April was below the level of the surge in March and below the moderate levels in January and February. The rate in April was also in line with IHS Markit's expectation of lower monthly SAARs in the second quarter. Auto consumers in the US continue to benefit from high incentives and credit availability, but vehicle affordability concerns such as due to rising interest rates and growing average transaction prices continue to surface. Light truck sales continue to propel the market and we maintain our US light-vehicle sales projection of 16.8 million units for 2019.
Headwinds from an incoming flow of used vehicles, vehicle affordability issues stemming from rising interest rates and rising average transaction prices, and a continued expectation of a passenger car sales slowdown result in expectations that overall US light-vehicle demand will decline in 2019, but remain at a relatively solid level for the industry.
There were 25 selling days in April this year, one more than in the same month last year and two fewer than in March 2019. Despite the extra day, on a unit volume level, an estimated 1.33 million light vehicles were sold in April, a decrease of approximately 2.3% y/y and continuing the downward trend in 2019.
Although there was an extra selling day compared with April 2018 and a solid overall pace of sales during last month, April's results by manufacturer were mostly negative.
Continuing the ongoing US market shift, light truck sales continue to outpace sales of passenger cars. Overall, in April, passenger car sales were estimated to be down more than 7.7% y/y, while light truck sales were up approximately 2.5% and accounted for more than 70% of light-vehicle demand, compared with a 68% share in April 2018.
According to AutoData, month-end inventories in the United States were down approximately 52,000 units from the month-end March levels. Passenger-car inventories continue to decline, down 32,000 units last month, and truck inventories declined 20,000 units.
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