SANTA MONICA, Calif.—TrueCar, Inc. projects U.S. revenue from new vehicle sales reached $45 billion for the month of November, up 1.6 percent from a year ago.
Despite lower average transaction prices, automakers should post a $712 million gain in revenue compared to last year due to two more selling days in November 2016 versus a year ago.
Average Transaction Prices in November 2016 are growing by 1.2 percent compared to the prior month while showing a loss of 1.9 percent over the prior year.
“Despite healthy economic fundamentals and strong demand for new vehicles, incentive spending is expected to be up by a record 13 percent year-over-year, affecting transaction prices negatively for the outgoing 2016 model year,” said Oliver Strauss, TrueCar’s chief economist. “Nevertheless, two more selling days in November 2016 are helping the automakers generate more overall revenue than a year ago.”
Ford and GM are expected to grow by 2.9 and 1.7 percent in average transaction prices year-over-year, respectively. Volkswagen Group continues to accelerate by 3.1 percent versus November 2015, a possible indication of continued signs of recovery from the TDI emissions issues a year ago.
TrueCar estimates the average transaction price (ATP) for a new light vehicle was $32,667 in November, down 1.9 percent from a year ago. Average incentive spending per unit grew by $399 to $3,475. The ratio of incentive spending to ATP was 10.6 percent, up from 9.2 percent a year ago.
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Average Transaction Price (ATP) |
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|
Manufacturer |
Nov. 2016 |
Nov. 2015 |
Oct. |
Percent Nov. 2015 |
Percent |
|||||
| BMW (BMW, Mini) | $49,810 | $50,894 | $49,594 | -2.1% | 0.4% | |||||
| Daimler (Mercedes-Benz, Smart) | $58,443 | $59,665 | $57,864 | -2.0% | 1.0% | |||||
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | $33,263 | $33,304 | $33,701 | -0.1% | -1.3% | |||||
| Ford (Ford, Lincoln) | $35,978 | $34,954 | $36,750 | 2.9% | -2.1% | |||||
| GM (Buick, Cadillac, Chevrolet, GMC) | $36,774 | $36,148 | $36,701 | 1.7% | 0.2% | |||||
| Honda (Acura, Honda) | $28,031 | $27,908 | $27,753 | 0.4% | 1.0% | |||||
| Hyundai | $22,649 | $23,419 | $22,993 | -3.3% | -1.5% | |||||
| Kia | $24,029 | $24,041 | $24,174 | 0.0% | -0.6% | |||||
| Nissan (Nissan, Infiniti) | $26,693 | $27,862 | $28,306 | -4.2% | -5.7% | |||||
| Subaru | $28,059 | $27,519 | $28,429 | 2.0% | -1.3% | |||||
| Toyota (Lexus, Scion, Toyota) | $31,438 | $31,468 | $30,463 | -0.1% | 3.2% | |||||
| Volkswagen (Audi, Porsche, Volkswagen) | $41,339 | $40,080 | $41,630 | 3.1% | -0.7% | |||||
|
Industry |
$32,667 |
$33,305 |
$32,279 |
-1.9% |
1.2% |
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|
Incentive per Unit Spending |
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|
Manufacturer |
Nov. 2016 |
Nov. 2015 |
Oct. 2016 |
Percent Change |
Percent |
|||||
| BMW (BMW, Mini) | $6,279 | $5,012 | $6,472 | 25.3% | -3.0% | |||||
| Daimler (Mercedes-Benz, Smart) | $4,660 | $4,870 | $4,770 | -4.3% | -2.3% | |||||
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | $4,154 | $3,523 | $4,185 | 17.9% | -0.7% | |||||
| Ford (Ford, Lincoln) | $3,982 | $3,238 | $4,060 | 23.0% | -1.9% | |||||
| GM (Buick, Cadillac, Chevrolet, GMC) | $4,305 | $3,819 | $4,456 | 12.7% | -3.4% | |||||
| Honda (Acura, Honda) | $1,936 | $1,826 | $1,899 | 6.0% | 1.9% | |||||
| Hyundai | $2,468 | $2,184 | $2,467 | 13.0% | 0.0% | |||||
| Kia | $3,164 | $2,990 | $3,133 | 5.8% | 1.0% | |||||
| Nissan (Nissan, Infiniti) | $4,209 | $3,746 | $4,236 | 12.4% | -0.6% | |||||
| Subaru | $1,145 | $574 | $1,097 | 99.5% | 4.4% | |||||
| Toyota (Lexus, Scion, Toyota) | $2,420 | $2,357 | $2,429 | 2.7% | -0.4% | |||||
| Volkswagen (Audi, Porsche, Volkswagen) | $3,751 | $3,533 | $3,855 | 6.2% | -2.7% | |||||
|
Industry |
$3,475 |
$3,076 |
$3,525 |
13.0% |
-1.4% |
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|
Incentive Spending as a Percentage of ATP |
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|
Manufacturer |
Nov. 2016 |
Nov. 2015 |
Oct. 2016 |
Percent Change |
Percent |
|||||
| BMW (BMW, Mini) | 12.6% | 9.8% | 13.0% | 28.0% | -3.4% | |||||
| Daimler (Mercedes-Benz, Smart) | 8.0% | 8.2% | 8.2% | -2.3% | -3.3% | |||||
| FCA (Chrysler, Dodge, Jeep, Ram, Fiat) | 12.5% | 10.6% | 12.4% | 18.1% | 0.6% | |||||
| Ford (Ford, Lincoln) | 11.1% | 9.3% | 11.0% | 19.5% | 0.2% | |||||
| GM (Buick, Cadillac, Chevrolet, GMC) | 11.7% | 10.6% | 12.1% | 10.8% | -3.6% | |||||
| Honda (Acura, Honda) | 6.9% | 6.5% | 6.8% | 5.6% | 0.9% | |||||
| Hyundai | 10.9% | 9.3% | 10.7% | 16.8% | 1.6% | |||||
| Kia | 13.2% | 12.4% | 13.0% | 5.9% | 1.6% | |||||
| Nissan (Nissan, Infiniti) | 15.8% | 13.4% | 15.0% | 17.3% | 5.4% | |||||
| Subaru | 4.1% | 2.1% | 3.9% | 95.6% | 5.8% | |||||
| Toyota (Lexus, Scion, Toyota) | 7.7% | 7.5% | 8.0% | 2.8% | -3.5% | |||||
| Volkswagen (Audi, Porsche, Volkswagen) | 9.1% | 8.8% | 9.3% | 3.0% | -2.0% | |||||
|
Industry |
10.6% |
9.2% |
10.9% |
15.2% |
-2.6% |
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Expert Comments About November 2016 US Auto Sales
From Karl Brauer, executive market analyst for Autotrader and Kelley Blue Book:
“A 2016 record for auto sales remains within reach, despite a plateauing sales rate over the past several months. November provided two extra selling days, plus aggressive promotional activity from most manufacturers, to deliver record numbers for many brands. A strong December finish will mean a new annual sales peak, one that could prove very tough to top in 2017. It will take a dramatic increase in consumer confidence to maintain, let alone eclipse, the 2016 number, but with a new administration coming online January 20th anything is possible.”
From Michelle Krebs, senior analyst for Autotrader:
“Automakers accelerated incentives and promotions as the Thanksgiving weekend approached. Their efforts paid off in a higher Black Friday shopping traffic on our sites, notably Kelley Blue Book and Dealer.com, and ultimately in sales.”
From Rebecca Lindland, senior analyst for Kelley Blue Book:
“Auto sales continued on a historically torrid pace as consumers took to dealer lots in a post-election rush of consumer confidence and a record setting stock market. Post-Thanksgiving shoppers were rewarded with enticing incentives late in the month, and the two extra selling days provided more time than last November to take advantage of great deals. But have no fear – there will be plenty of attractive deals in December, too, as manufacturers want to finish the year with strong sales.”
From Jack Nerad, executive editorial director and executive market analyst for Kelley Blue Book:
“The combination of two additional sales days and a big dose of promotional activity enabled carmakers to turn in substantial sales increases in November, and several manufacturers saw sales reach record levels. For the first time many manufacturers promoted ‘Black Friday’ specials throughout the month, and the promotions obviously had an effect. At the same time, it seems every manufacturer is working harder – and paying more – for each sale. With a likely interest rate hike in December, it will be interesting to see if automakers can maintain the sales momentum as they close out the year.”
Tim Fleming, analyst for Kelley Blue Book:
“The race for another annual sales record looks as if it will go down to the wire. If November comes in as expected, I think there’s a 40-60 chance 2016 will set a new record. But December could come in just under last year’s strong showing, resulting in a miss of the 2015 record by maybe 10,000 sales.”
From Michael Harley, analyst for Kelley Blue Book:
“A tumultuous U.S. election didn’t shake consumer confidence as shoppers continued to flow into new-car showrooms. Crediting a big boost on Black Friday, most automakers posted gains in November with consumers’ insatiable appetite for crossovers, trucks and SUVs leading the charge. The stage has been set for a very interesting December as a record-breaking 2016 isn’t out of reach. Automakers must choose whether to increase incentives and fleet sales to move more vehicles, or dial back both to ensure more stable and profitable growth — I’m betting they go for the volume and sales records.”
From Akshay Anand, analyst for Kelley Blue Book:
“Aggressive incentives and extra selling days in November provided upticks for many OEMs after a slowdown in growth for much of 2016. We will likely end the year near 2015's record pace, which tells us that despite the slowing growth, the industry is still in a good spot for the near future.”
From Zohaib Rahim, analyst for Autotrader:
“Assumption of a cyclical downturn in auto industry seems overstated for the moment; in addition to the extra selling days and promotions, the average consumer is in a good spot right now. We have seen an increase in real personal spending, gains in personal income growth, and though jobless claims are up for two weeks in a row, they are trending downwards. The Index of Consumer Sentiment saw a gain month-over-month for November with a post-election surge in positive sentiment, with the same bullish sentiment seen in the equity markets.”
From James Grace, director of analytics product management for Dealer.com:
“Online shopping for new cars increased 3 percent in November compared with November 2015 as consumers responded to automakers’ push to end the year strong. Shopping for used cars was down 1 percent for the same period.”
“Automotive digital advertising costs increased sharply in November, up 5 percent compared with October. Black Friday advertising, both in the automotive sector and elsewhere, played a big role in driving increased demand and costs in November.” (Dealer.com, a Cox Automotive company based in Burlington, Vt., runs 62 percent of the nation’s dealer websites).
Brad Korner, general manager for AIS Rebates:
“The total number of incentive programs across the industry stayed relatively low through early November, well below October. Then came the Thanksgiving holiday, and many automakers poured on incentives to remain competitive and drive traffic, which worked.”
“Hybrid and electric vehicles still carry the biggest incentives due to slumping sales. Incentives for pickup trucks were high as well because automakers want to stay competitive and capitalize on the boom in this high-profit part of the business.” (AIS Rebates, a Cox Automotive company, is an industry leader in rebate and incentive research and analysis.)
FCA Comments
From Rebecca Lindland, senior analyst for Kelley Blue Book:
“FCA continued to lose momentum as it reconfigures its various brands, as well as constrains lower profit fleet sales. The all-new Compass cannot come soon enough for Jeep, and Chrysler cannot live on Pacifica alone. Fortunately, Ram brand is selling well, with Ram pickup up 8 percent. Now is certainly the time to get a great deal on many models from FCA.”
From Michelle Krebs, senior analyst for Autotrader:
“Fiat Chrysler sales, down 14 percent, fell far more than expected, but against some very tough comparisons a year ago. The bright spot in November was Ram commercial vans and pickup trucks. Fiat Chrysler has been targeting its incentives spending on its all-important Ram trucks.”
From Michael Harley, analyst for Kelley Blue Book:
“Alfa Romeo and FIAT, with sales down 32 percent and 15 percent respectively, continue to be heavy anchors that the automaker can’t seem to pull out of the water — both are drowning. FCA may need to cut the chain and focus its attention on its stronger and more established brands.”
From Akshay Anand, analyst for Kelley Blue Book:
FCA did not experience the growth some of its domestic rivals did in November, though fleet numbers still need to be teased out for all brands. The Jeep Renegade continues to be a hot seller, but Cherokee, Wrangler and Grand Cherokee all dipped in November. Still, Jeep is likely the least of FCA's concerns, as Fiat and Chrysler continue to drop in sales as well.
Ford Comments
From Michelle Krebs, senior analyst for Autotrader:
“Finally, Ford had a good month, and mostly from retail sales, since fleet orders were down. Ford’s strength came from high-profit trucks and sport utilities, like Explorer, Edge, Escape and Lincoln’s utilities. The new Ford F-250 jumped to the third most-shopped truck on Autotrader in November, pushing total F-Series sales to 72,000 plus. Ford car sales were down again, double digits, with only the hybrid C-Max up, thanks to very hefty incentives.”
From Rebecca Lindland, senior analyst for Kelley Blue Book:
“Pickup truck buyers pushed the Ford F-Series to its best November in 15 years, perhaps reflecting post-election improved consumer confidence for small businesses. Shoppers are rewarding Lincoln brand’s lineup but sales are still less than 5 percent of Ford’s overall sales.”
From Akshay Anand, analyst for Kelley Blue Book:
SUVs and trucks – Is anyone surprised? Ford's November looked strong on the back of its core larger models, including the F-Series, which sold over 70,000 units and is on pace to close out the year above 800,000 units in sales for 2016. On the flip side, cars were once again a weak point, and the Transit experienced a dip after being a shining star for Ford for almost all of 2016.
GM Comments
From Rebecca Lindland, senior analyst for Kelley Blue Book:
“Consumers gravitated toward GM’s newest SUVs, pushing all four brands up nearly 8 percent combined. The Buick Encore and Envision, Cadillac XT5 and GMC Acadia were all hot sellers. GM continued its strategic, targeted approach to fleet sales, with Chevrolet’s Tahoe and Malibu and GMC Yukon well above annual trend. I’m keeping an eye on inventory, which is up to 87 days versus 84 last year. An ideal number is closer to 60 days, so watch for year-end blow out sales in December.”
From Michelle Krebs, senior analyst for Autotrader:
“GM signaled fleet sales were up, and it looks like the Chevrolet Malibu and Buick Regal were in that fleet order. Chevrolet and GMC smaller Colorado and Canyon trucks continued to post stunning sales performances with the larger Silverado and Sierra holding strong as well. Chevrolet has been offering some hefty and highly targeted incentives on some Silverado markets as the truck wars heat up. Cadillac’s strength came mostly from sport utilities. The XT5 is now Cadillac’s best-selling model, as the SRX was before it. That’s good news. Now Cadillac needs more sport utilities.”
From Akshay Anand, analyst for Kelley Blue Book:
The Thanksgiving holiday season was good to GM, who saw increases across all their brands for the first time in a while. The increases in Cadillac SUVs are a nice change, as the brand has been struggling compared to some of the other GM brands this year. However, Cadillac sedans continue to dip. Perhaps the biggest story for Chevy was the hefty Malibu increase, though it remains to be seen how much of the increase was retail versus fleet.
Honda Comments
From Michelle Krebs, senior analyst for Autotrader:
“Honda definitely bucks the trend on car sales, and it does it without huge incentives. Bucking the trend, however, doesn’t carry over to Acura, where only the MDX sport utility had a meaningful sales increase.”
Nissan Comments
From Michelle Krebs, senior analyst for Autotrader:
“Star Wars Storm Troopers are doing the job to advertise and boost sales of the Nissan Rogue. In fact, all Nissan and Infiniti utilities as well as the Titan pickup had a great month, while Nissan and Infiniti cars were a mixed bag. Those big truck and utility sales are boosting Nissan’s average transaction prices, which help offset hefty incentives, like those on the Nissan Leaf.”
From Michael Harley, analyst for Kelley Blue Book:
“Nissan North America, including both Nissan and Infiniti sales, was up 7.5 percent compared to last November. While its car volume was down 5.5 percent, its crossovers, trucks, and SUVs, rose 22.2 percent to carry the automaker to a new November record.”
Toyota Comments
From Michael Harley, analyst for Kelley Blue Book:
“Toyota Motors, including Toyota and Lexus, reported a 4.3 percent bump in sales compared to last November. While its overall car volume fell at an alarming rate, crossovers, trucks and SUVs, which consumers can’t seem to get enough of, carried the automaker. The Highlander crossover, up nearly 67 percent, had its best-ever month, while its fuel efficient Prius saw volume drop across all models as consumers continue to enjoy relatively low gasoline prices.”
Volkswagen Comments
From Michael Harley, analyst for Kelley Blue Book:
“Consumers have returned to Volkswagen’s showrooms, despite any approved fix for its 2.0-liter or 3.0-liter TDI engines that are the focus of its ongoing diesel scandal. Americans are very forgiving, which is evident by the automaker’s 24 percent increase in sales over last November.”
