Thomas FoxComment

U.S. Auto Sales Projected to Fall for the 6th Month in a Row

Thomas FoxComment
U.S. Auto Sales Projected to Fall for the 6th Month in a Row

Even as we head into the summer months, a typical pick up in sales for the auto industry, sales in the U.S. are expected to drop again.

Typical auto sales see an up-tick in the summer months; a decrease in sales this year would be just the third time since 2009 that sales have not risen. Projections are showing a decrease in light-vehicle deliveries between 1.5 and 3.3 percent for June compared to 2018. Not only would this decline be rare this time of year, it would also be the sixth straight month of falling sales.

June sales numbers will be confirmed on Tuesday of this week but projections tend to be pretty accurate. However, despite this drop in June, sales are still reasonably strong across the U.S. This drop is by no means an indication of a struggling auto industry or economy.

There could be severals explanations for this most recent slowdown…let’s take a look at a couple of them.

  1. Tariffs. Tired of hearing about them yet? Sorry, it’s not over yet. Fear over tariffs are effecting consumers as well as dealerships because of the high degree of volatility. Given these concerns, we expect some consumers are just simply waiting it out a bit before making a big purchase on a vehicle.

  2. Incentives. Interestingly, manufacturer spending on incentives has generally decreased as well. It’s easy to image that this has a pretty direct correlation on sales. TrueCar estimates that spending for incentives in June fell about 1% vs. June of 2018.

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