June’s forecasted new vehicle sales continue on a path of recovery as the market crawls out of the hole dug by coronavirus shutdowns.
Total vehicle sales in June are projected to reach about 1.1 million units, a 25.1% decrease compared to last year, according to a joint forecast released Friday from J.D. Power and LMC Automotive. That estimate adjusts for the difference in the number of selling days from June 2019.
The projection calls for the SAAR for total sales to reach 12.8 million units, a decrease of 4.4 million units from 2019.
Sales of new vehicles are expected to be down 11.3% compared to June 2019, sitting at about 1 million units.
“The industry continues to show signs of recovery in June, with retail sales down only 6% compared with the J.D. Power pre-virus forecast. This represents a significant improvement from May when retail sales were off 20% from the pre-virus forecast,” said Thomas King, president of the data and analytics division at J.D. Power. “The combination of pent-up demand, states relaxing coronavirus-related restriction and elevated incentives are all providing a tailwind for the industry.”
Manufactures are helping boost recovery through incentive spending, which is nearing a record average of $4,411 in June, an increase of $445 from this time last year, according to the forecast. Car incentives are projected to reach $4,031 on average in June, an increase of $459, while incentives on trucks and SUVs are estimated at $4,524, up $407.
As the industry recovers, lenders will benefit from higher transaction prices. Prices in June are expected to reach a record average of $34,981, a 3.9% increase YoY, largely due to more consumers preferring SUVs and trucks to cars.
Consumers are projected to spend $35.1 billion on new vehicles in June, down $4.5 billion from 2019, the forecast states.
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