Cars and Drivers

New Car Sales Forecast to Rise 6% in June

The American new car market continues to shoot toward new records. According to Kelley Blue Book (KBB), June will help sales move much higher. Sales are expected to rise 6%, compared to the same month of last year, to 1.5 million. Some experts wonder how long the improvement can continue as the market becomes saturated with relatively new cars that replace those Americans bought years ago.

Fiat Chrysler Automobiles N.V. (NYSE: FCAU) brands are expected to lead the way, as they have for a number of months since the auto market began a recovery from the recession. This is despite the fact that many of its cars and light trucks get remarkably poor quality ratings. The company’s sales are expected to grow 10.5% to 189,000. Alec Gutierrez, senior analyst for Kelley Blue Book, said:

Kelley Blue Book anticipates positive numbers from nearly all manufacturers in June 2015, but Fiat Chrysler Automobiles could see the largest year-over-year gains. The surge in popularity of utility and truck models this year has been beneficial for Fiat Chrysler’s Jeep and RAM brands, helping push the manufacturer to its highest U.S. market share since 2007.

When the company exited bankruptcy, and Fiat began to take an ownership position, few thought the third largest car company in America could do so well.

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In another turnaround, Volkswagen, which has done as poorly as any other brand sold in the United States, is expected to finally show some progress. Sales are predicted to rise 10.5% in June to 55,000. VW’s improvement will be supported by a surge in sales of its Audi luxury brand. Unfortunately, the largest car company in Europe, and one of the largest in the world, will still have only a 3.7% market share in America.

Toyota Motor Corp. (NYSE: TM) will continue its progress to pass Ford Motor Co. (NYSE: F) as the number two car company in the United States based on sales. Toyota sales are expected to rise 6.1% to 214,000. Ford’s are forecast to rise 4.8% to 232,000.

The two other large Japanese manufacturers are likely to have mediocre June results. Honda Motor Co. Ltd. (NYSE: HMC) sales are expected to rise 7% to 138,000. Nissan sales are expected to rise 6.7% to 117,000.

Finally, General Motors Co. (NYSE: GM) will continue to have a large lead over all other car companies. Its market share is expected to be 18.9% in June, with sales rising 6.2% to 284,000.

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KBB analysts expect car sales in the United States to reach their highest levels in a nearly a decade, reaching toward all-time records:

The expected 1.5 million units this month will bring the first-half of 2015 totals to 8.53 million, a 4.7 percent increase from the same time last year, and the highest first-half since 2005. Second-quarter sales will come in at 4.58 million units, a 3.9 percent increase year-over-year, and also the highest second quarter total since 2005. In addition, total sales in 2015 are projected to hit 17.1 million units overall, a 3.6 year-over-year jump and the highest overall total since 2001.

The last new-car party ended as the recession set in. In the current case, the problem is that every American has a new car.

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