AIADA REPORT May 2017 US Auto Sales: As Demand for Cars Slips, U.S. Auto Sales Remain Flat

While both gas and credit remain cheap in 2017, auto sales appear to be plateauing. AutoData Corp. reports that the seasonally adjusted annual rate (SAAR) for May 2017 was 16.66 million units versus 17.17 million units a year ago, with total industry unit deliveries down 0.5 percent compared to last May. Incentives are up 33 percent from May 2016 and transaction prices are also on the rise, averaging $33,261, as consumers opt for pricier light trucks over cars. Truck sales were up 6 percent from a year ago, while car sales fell 9.3 percent. Nissan’s sales rose 1.9 percent last month, Toyota’s sales were up 0.1 percent, and Volkswagen saw an improvement of 4.3 percent. Hyundai’s sales slipped 18 percent and Mazda’s sales were down 8.1 percent.

“A SAAR above 16 million is still a healthy rate for the industry,” said AIADA President Cody Lusk. “Dealers and manufacturers are making the necessary adjustments to meet current demand levels and satisfy customers’ appetites for trucks and SUVs.”

International Brands Score Lead in May Auto Market

International brand market share grew slightly in May, edging up to 55.8 percent from the 55.5 percent share they held in April. However, this market share was down slightly from the 56.1 percent share they held in May 2016. Overall sales totaled 848,268 units, a bounce from April sales figures of 791,680 units, but a slight decline from last May when they sold 856,890 vehicles in the U.S. market.

Asian brands represented the largest slice of the U.S. auto market in May, capturing 47 percent – an improvement over the 46.5 percent share they occupied in April, but down slightly from 47.3 percent in May 2016. Overall sales of 714,262 Asian brand vehicles were an improvement over April’s slow sales of 663,625 vehicles, but they were down 1 percent from last May when they sold 721,311 vehicles.

European brands finished the month with 8.8 percent of the U.S. auto market, down from 9 percent in April and 8.9 percent in May 2016. These brands, led by Volkswagen, sold 134,006 vehicles in the American market in May, up from 128,055 units in April, but down 1.2 percent from May 2016 when they sold 135,579 units.

Finally, domestic brands took 44.2 percent of the May market, down slightly from 44.5 percent in April, but up from 43.9 percent market share in May 2016. Overall sales of 670,907 units were up from 634,446 vehicles in April and 669,654 in May 2016.

May Autos Trend Toward Trucks, SUVs

In line with recent trends, trucks and SUVs remained the most popular options with U.S. buyers in May. Six of the month’s top ten selling vehicles fell into this category, led by the Ford F-Series, Ram, and Chevrolet Silverado pickups in first, second, and third place, respectively.

In fourth place overall, the Toyota RAV4 took the title of most popular crossover for the month with sales up 18.9 percent over May 2016. The Nissan Rogue also experienced a solid month of sales, taking the seventh place spot thanks to sales that were up 18.9 percent over last May. The recently-redesigned Honda CR-V also experienced a solid month, taking eighth place with sales up 9.6 percent from last May.

Although trucks and SUVs were in the spotlight, several cars were still popular among U.S. buyers. The Honda Accord took the title of the month’s top-selling car, taking fifth place in the monthly roster with sales up 5 percent. The Toyota Camry followed in sixth place. Sales for the midsize sedan were down 11.8 percent. The Honda Civic took ninth place for the month with sales down 9.6 percent, while the Toyota Corolla captured the tenth place slot to finish the month with sales down 11.3 percent.

N. American Manufacturing Remains Crucial Part of U.S. Auto Market

Thanks to global trade, North American manufacturing units have allowed auto manufacturers to build their vehicles close to where they sell them in North America. These include several facilities in the U.S. In May, North American manufacturing units operated by international brands supplied 544,545 vehicles for the U.S. market. These included 499,636 Asian brand vehicles (253,219 cars and 246,417 trucks) and 44,909 European brand vehicles (26,242 cars and 18,667 trucks).

Sales Rate and Outlook

Industrywide, 1,519,175 light vehicles were sold in May, up from 1,426,126 in April 2017 but down from 1,526,544 units in May 2016. Unadjusted for business days, sales for all brands were down 0.5 percent from the same date a year ago and 2 percent year to date.