When automakers report September sales next Wednesday, comparisons to last September and to August are going to look awful. The good news is sales are not really as bad as they’ll look.
The three-day Labor Day holiday weekend is one of the auto industry’s biggest selling periods. The holiday was counted in August this year, giving last month (and last September) an additional five selling days compared to this month. That translates into a drop of some 200,000 unit sales year over year and close to 400,000 month over month, according to industry analysis firm Cox Automotive.
The fairest comparison, according to Cox, is August’s seasonally adjusted annual rate (SAAR) of sales, which reached 17 million units. September’s SAAR is forecast to reach 16.9 million.
Senior economist Charlie Chesbrough commented, “This likely September SAAR suggests a market more stable over the last three months than it was during the first half of the year.”
Among the factors that could put more pressure on September sales is the autoworkers strike against General Motors, now in its second week. The longer the strike lasts, the greater the possibility that popular vehicles will not be available. The effect could get even worse in the coming months.
Another factor that could weigh on sales for this month and the rest of the year is declining consumer confidence.
On the plus side, carmakers are offering substantial pricing incentives to clear out inventory as new 2020 models make their appearance on dealer lots.
Of the nine automakers selling the most vehicles in the United States, none is forecast to post higher year-over-year or month-over-month sales. Total year-over-year sales are forecast to drop by 13.7% and month-over-month sales are expected to be down 24.2%.
Cox is forecasting GM’s September sales will reach 213,000 units, down nearly 10% year over year. Ford sales are forecast to decline 13.5% to 170,000 units, and Fiat Chrysler sales are expected to drop 17.4% to 165,000 units.
Toyota sales for September are expected to reach 175,000 units, down 13.8% year over year, while Honda sales are tabbed to fall 5.8% to 125,000 units. Hyundai-Kia, Nissan, Volkswagen and Subaru are all forecast to see sales fall more than 20% compared to August.