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J.D. Power: Strong December Sales Will Lead to Robust Finish for 2010

December 30, 2010

WESTLAKE VILLAGE, Calif. — The December new-vehicle retail sales pace is significantly beating expectations, driving a strong close to a challenging year of recovery, according to J.D. Power and Associates.

Retail Light-Vehicle Sales
December new-vehicle retail sales are expected to come in at 936,300 units, which represents a seasonally adjusted annualized rate (SAAR) of 10.8 million units. December retail sales are expected to be up 19 percent from one year ago. Retail transactions are the most accurate measurement of true underlying consumer demand for new vehicles.

“Even with the possibility that sales in the third week of December may be affected by the recent winter storms, the strength in sales during the second week is expected to continue through the rest of the month,” said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “As a result, it appears that 2010 will end on a high note.”

U.S. Retail SAAR from December 2009 to December 2010 (in millions of units)

Total Light-Vehicle Sales
Total light-vehicle sales for December are expected to come in at 1,133,000 units, which is 14 percent higher than December 2009. Fleet sales are projected to decrease in December, with volume expected below 200,000 units — down 3 percent from December 2009. Fleet share of total sales in December is expected to be at 17 percent, the lowest level all year.

J.D. Power and Associates U.S. Sales and SAAR Comparisons

 

December 20101

November 2010

December 2009

New-vehicle retail sales

936,300 units
(19% higher than December 2009)2

684,712 units

817,426 units

Total vehicle sales

1,133,000 units
(14% higher than December 2009)

871,299 units

1,027,837 units

Retail SAAR

10.8 million units

9.7 million units

9.3 million units

Total SAAR

12.4 million units

12.3 million units

11.1 million units

1Figures cited for December 2010 are forecasted based on the first 10 selling days of the month.
2The percentage change is adjusted based on the number of selling days (27 days vs. 28 days one year ago).

Sales Outlook
Given a stronger-than-expected retail performance in December, J.D. Power and Associates has increased its retail sales forecast for the year to 9.2 million units (from 9.1 million units). The forecast for total light-vehicle sales in 2010 has also been adjusted to round up to 11.6 million units (from 11.5 million units)

“The continuation of the strong performance in the retail market through December may be the confirmation that the industry has been looking for that the recovery has been re-engaged,” said Schuster. “The likelihood of an extension of the tax cuts, in addition to a strong close in 2010, bodes well for the automotive market in 2011.”

For 2011, J.D. Power’s forecast remains at 10.4 million units for retail sales and 12.8 million units for total sales.

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