BANDON, Ore. — Based on the first two weeks, December is shaping up to be a strong month for the industry, reported CNW Research. Already, floor traffic and closing ratios were up 7.8 and 13.7 percent, respectively, for the first half of the month.
Based on what it's seeing, the research firm said December's True Delivery Rate could easily top the 13.3 million, with sales coming in at 1.2 million units.
“This is happening as the Jitters Index continues to decline on a month-to-month basis — down 1.24 percent versus November,” wrote CNW’s Art Spinella. The research firm’s Jitters Index measures consumer sentiment regarding home-centric economic issues.
Excluding new or refurbished dealerships, the report also revealed that deliveries were up 7.9 percent in same-store sales, an indication that the market is rebounding toward that 12.8 million-unit mark. If things stay on track, that could mean a more than 11 percent increase in sales year over year, according to CNW.
“The interesting number is the huge 30 percent jump in month-over-month sales vs. November,” Spinella wrote.
On the credit application front, all categories experienced significant increases during the first half of December vs. a year ago. Subprime approvals in December increased more than 20 percent year over year and 15.7 percent month over month, CNW reported. For the full year, prime approvals increased 12.5 percent, nearprime increased 20.1 percent and subprime increased 53.9 percent.
On the used-car side, lack of inventory continued to plague dealers in November, with sales of vehicles one to three years old were off by 2 to 5 percent on a share of sales basis. Franchised dealers were able to buck the trend, however, as their share of used vehicles sold in November increased 4.75 percent year over year to $10.2 billion.
“Overall, the industry had a good month with the value of all vehicles retailed coming in at over $23.8 billion, a 3.8 percent increase,” Spinella wrote.
The value of private-party November sales increased by 11.2 percent to $7.8 billion, the report stated. Independents failed to keep up, however, as the value of their sales decreased by 6 percent to $5.8 billion on a year-over-year basis.
Spinella anticipates total used sales in 2011 will surpass 38.7 million units, making this year the most successful since 2007’s 41.4 million.
“Franchised dealers are set to have a banner year with sales up 8.1 percent versus 2010,” he added. “Independents should finish the year on a 5.8 percent positive note, while private party sales will pretty much match 2010 with only a 0.3 percent increase.”