Strong Consumer Response to Lift August New-Vehicle Retail Sales to Highest Level in the Past Year

WESTLAKE VILLAGE, Calif., Aug. 20, 2009; New-vehicle retail sales in August are forecasted to cross the 1-million-unit mark for the first time in the past 12 months, boosted by the government-funded Car Allowance Rebate System (CARS) program, according to J.D. Power and Associates, which gathers real-time transaction data from more than 10,000 dealerships across the United States.

Based on the first 13 selling days of the month, new-vehicle retail sales for the month of August are expected to come in at slightly more than 1 million units, up nearly 2 percent from one year ago. This marks the first increase in retail sales volume since June 2007.

"Improved consumer confidence and credit availability during the past six months have combined with the CARS program to lift industry sales out of their slumping year-to-date levels, which have been down approximately 35 percent year-over-year," said Gary Dilts, senior vice president of global automotive operations at J.D. Power and Associates. "These factors set the foundation for a gradual recovery in the months ahead. Reduced inventories will likely hold back some of this momentum, but the automakers are moving quickly to ramp up production and rebuild stock."

As inventory is channeled to retail sales, August fleet sales are expected to decline by more than 50 percent compared with one year ago. As a result, August total light-vehicle sales are projected to come in at 1.1 million units, down just 8 percent from August 2008. The August seasonally adjusted annualized rate (SAAR) for total vehicle sales increases to 12.2 million units, up 1.2 million units from July.

  J.D. Power and Associates U.S. Sales and SAAR Comparisons - August 2009

                    August 2009(1)         July 2009          August 2008
                     -------------         ---------          -----------
  New-vehicle
   retail sales     1,030,000 units      878,900 units      1,054,300 units
                    (2% higher than
                      August 2008)
  Total vehicle
   sales            1,110,000 units      995,977 units      1,248,066 units
                     (8% lower than
                       August 2008)
  Retail SAAR     10.6 million units   9.2 million units  11.0 million units
  Total SAAR      12.2 million units  11.0 million units  13.7 million units

  (1) Figures cited for August 2009 are forecasted numbers based on the
      first 13 selling days of the month. The percentage change is adjusted
      based on the number of selling days.

Given the positive impact of the CARS program, J.D. Power and Associates is increasing its forecast for 2009 to 10.3 million units for total sales. Retail sales are projected to come in at 8.6 million units--300,000 units more than previously expected--while the projection for fleet sales has been reduced to account for a shortage in inventory.

"Amid relative economic stability and a more disciplined management of fleet sales, the industry is showing signs of a more rational balance of sales and production levels," said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. "However, there is risk that the expected pullback in sales as the CARS program ends could be magnified if manufacturers reduce incentive levels. This could stall the recovery and negate the boost that the program has generated in the third quarter."

In light of the expected pull-ahead sales as a result of the CARS program and a flatter-than-anticipated recovery, J.D. Power and Associates has lowered its forecast slightly for 2010 to 11.5 million units for total sales and 9.5 million for retail sales.

About J.D. Power and Associates

Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2008 were $6.4 billion. Additional information is available at http://www.mcgraw-hill.com/.