February new-vehicle retail sales are expected to increase marginally compared with February 2009, according to the latest Power forecast.
February retail sales are now projected to come in at 561,500 units, which means a seasonally adjusted annualized rate (SAAR) of 8 million units, compared with 7.9 million units in February 2009. Fleet sales continue to rebound from the lower levels experienced one year ago. As a result, total sales for February 2010 are projected to come in at 741,500 units, up 8% from February 2009.
|U.S. Sales and SAAR Comparisons – February 2010|
|February 2010||January 2010||February 2009|
|New retail sales||561,500 units (+1% Feb 09)||514,633 units||556,689 units|
|Total vehicle sales||741,500 units (+8% Feb 09)||697,368 units||688,244 units|
|Retail SAAR||8.0 million units||8.1 million units||7.9 million units|
|Total SAAR||9.9 million units||10.7 million units||9.1 million units|
|Courtesy of J.D. Power and Associates. February 2010 numbers based on the first 17 selling days.|
J.D. Power and Associates compiles transaction data from more than 8,900 franchised new cars dealers across the United States to use in projecting sales.
“While February sales have improved from a year ago, the pace of the recovery has hit a speed bump, with this month’s SAAR down from January’s selling rate,” said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “This hiccup appears to be the result of consumers waiting out the Toyota recalls and winter storms impacting showroom traffic, but the effects of these external factors are likely temporary and the recovery is expected to get back on track.”
Given stronger-than-expected economic growth in the fourth quarter of 2009 and improved financing and leasing conditions, J.D. Power and Associates is increasing its 2010 forecast to 11.7 million units, up from 11.5 million units, for total sales and to 9.6 million units, up from 9.5 million units, for retail sales, despite February’s expected poor performance.
At the beginning of February, vehicle inventory was at a 71-day supply, compared with 121 days in February 2009. For the first quarter of 2010, production remains on track to increase by more than 1 million units from the same period one year ago. Production volume for 2010 overall is expected to increase by 24% to 10.6 million from 8.5 million in 2009.
“Although inventory levels have improved from a year ago, they have increased from levels during the past four months—creating a risk of inflated inventory levels in the short term, given the slower sales pace in February,” said Schuster. “In addition, the recovery in production levels is more pronounced than the recovery in demand after the extensive production cuts in 2009, adding concern of further inventory troubles throughout the year.”