Report: January Light-Vehicle Sales Best Since 2004
Jan. 24, 2014—A monthly sales forecast released Friday by J.D. Power and LMC Automotive reveals that new light-vehicle sales in January will be the highest since 2004.
"We are forecasting January 2014 to have the strongest level of retail sales for a January since 2004, and transaction prices will be the highest on record for the month of January," said John Humphrey, senior vice president of the global automotive practice at J.D. Power. "In combination, the strong sales rate and record transaction prices are expected to result in record levels of consumer spending for the sector."
Vehicle sales are expected to reach 847,400, a 3 percent increase from January 2013. The January 2014 seasonally adjusted annualized rate (SAAR) for retail sales is projected to reach 13.1 million, an increase of 400,000 units from December, and 300,000 units higher than the selling rate in January 2013.
Retail transaction prices in January are also on track to exceed $29,500, up nearly $300 compared to January 2013. Consumer spending is expected to increase by $1 billion compared to January 2013, which is driven by both higher prices and higher sales volume, according to the report.
Other noteworthy trends include strong demand for vehicles in the compact CUV segment, which currently accounts for 16.3 percent of industry retail sales, up 3.5 percentage points from last January.
"The growth of the CUV segment reflects the confluence of several factors, but most notably the availability of recently redesigned products that offer new technology and improved fuel economy," said Humphrey. "However, gains in the compact CUV segment are coming at the expense of the midsize sedan segment, which has lost some momentum as products redesigned several years ago lose ground to newer CUV models."
Total light-vehicle sales in January are expected to approach 1.1 million, a 1 percent increase from January 2013, as fleet sales are expected to remain below the level of a year ago and represent less than 20 percent of total light-vehicle sales for the month.
J.D. Power and LMC are basing the January forecasts off of the first 15 selling days of the month of January.