Bad Car Sales Lower January Retail Sales

02/28/96

Reuters reported that retail sales for the month of January were down .3% to a seasonally adjusted total of $199.1 billion. The Commerce Department said that weak car sales in January pulled down the overall statistic. Discounting automobile sales, retail sales were flat.

Sales of new cars in January fell 1.2% to a seasonally adjusted $4.8 billion. The month before they saw an increase of 1.6%. Carmakers have too many cars on dealer lots, so manufacturers are reducing production and some are offering incentives to try and boost sales.

Sales of new cars usually account for 20% of total retail sales, so variation in demand for cars has tremendous impact on national sales statistics. The .3% decrease was less of a drop than economists had predicted (.4%).

Paul Dever -- The Auto Channel