August annualized sales rate seen at over 15.5 million units

Article by Anita Panait, on August 29, 2013

Forecasters remarked the annualized sales rate for August in the United States is tracking above 15.5 million units, boosted by strong replacement demand as well as cheap and available credit. Three of four major independent forecasters are expected a modest drop in selling pace in August from 15.9 million units in June and 15.8 million in July. TrueCar.com expects the rate in August to be 15.75 million, Kelley Blue Book at 15.6 million and Wells Fargo at between 15.5 million to 15.6 million units. On the other hand, a joint forecast by J.D. Power and Associates and LMC Automotive says that the selling pace in August will hit 16 million units, the level for the first time since late 2007. On average, the seasonally adjusted annualized rate is 15.7 million. Carmakers are set to report their sales results in the US for August on Sept. 4, 2013. According to Jeff Schuster, senior vice president of forecasting at LMC Automotive, the auto recovery in the US “seems to be operating on autopilot, a welcome stage of stability at a higher pace."

He noted that the Labor Day weekend will be counted in August this year instead of September. He remarked that they expect a lower selling rate in September since Labor Day is counted in August sales. Analysts also remarked that close-out deals on 2013 models are spiking demand. TrueCar.com analyst Jesse Toprak quipped that vehicles sales have remained strong despite recent weakness in US financial markets.

He said new vehicle sales “defied their typical strong correlation with Wall Street in August” and went on to log a healthy surge despite the lackluster performance of the financial market. He noted that even low incentives failed to slow down sales. TrueCar.com estimates the industry average per-vehicle incentive in August at $2,477. Alec Gutierrez of Kelley Blue Book remarked that August sales could have been higher if some carmakers like Ford, Subaru and Hyundai, didn’t succumb to shortages of popular models.

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