Strong July sales tip the scales to a more optimistic outlook
For the first time since early in the year, it’s beginning to look like 2010 sales could surpass the analysts’ initial forecasts. Based on results through July, Scotiabank senior economist Carlos Gomes has raised his full-year 2010 sales forecast to 1.565 million units, from an initial level of 1.525 million.
That’s an increase of 7.3 percent from 2009’s 1.46-million total. Year-to-date, through July, sales are running 8.6 percent ahead of 2009 so it still seems a conservative forecast. July’s SAAR (Seasonally Adjusted Annual Rate) was in the range of 1.65 million according to Gomes. Dennis DesRosiers, of DesRosiers Automotive Consultants, calculated it at 1.69 million – the highest in two years by his reckoning.
Either way, it’s a positive sign for an industry that, while in much better shape than last year, seemed stuck on a plateau.
July sales tip the scale
It was July’s strong sales that tipped the scale to a more optimistic outlook. They were up just 6.3 percent, year-over-year, but that is relative to a month when the rate of decline dropped dramatically in 2009. From perhaps a more relevant perspective, they were up 2.1 percent from the five-year average for July and down less than half a percent from 2008’s near-record sales for the month.
Strong showings by the Detroit Three played prominently in that performance. Chrysler sales were up 40.0 percent; GM’s 22.4 percent; and Ford’s 1.6 percent from last July and, collectively, they claimed 49.3 percent of the market – their highest monthly share of the year. Year-to-date, their share is up to 46.4 percent.
Compared to their five-year averages for the month, Ford (+21.7%) and Chrysler (+19.7%) substantially exceeded their historic norms while GM (-36.0%) continued to underperform. Ford again claimed the monthly sales crown – with GM well behind in second, and Chrysler a close third. Year-to-date Ford’s advantage over GM now approaches 13,000 units.
Among the import brands, Honda (-10,2%) and Toyota (-22.8%) continued to drag their collective share down. Not only were those high-volume players’ sales down from last year, they were 21.2 and 22.2 percent, respectively, behind their five-year norms. Toyota is well back of the market leaders in fourth place, followed not far behind by Hyundai – now secure in fifth place year-to-date – and Honda.
Truck sales continued their torrid pace, with sales for the month up 22.0 percent, while passenger car sales fell by 7.8 percent. Year-to-date, trucks now claim 53.4 percent of the market – a 5.4 percent share increase from a year ago.
Three-month trends
The three-month moving sales average for overall sales has been relatively stable for the past quarter, between 5 and 6 percent ahead of 2009. For the May-July period the figure was 5.8 percent.
As has been the case throughout 2010, however, the overall trend is not necessarily representative of individual manufacturers’ results.
Compared to the same period last year, the big winners over the past three-month period were:
• Chrysler (+59.3%)
• Land Rover (+46.5%)
• Subaru (+28.2%)
• Audi (+21.7%)
• Porsche (+16.9%)
• Mercedes-Benz (+15.4%)
Prominent on the losing side of the ledger were:
• Suzuki(-35.8%)
• Toyota (-18.1%)
• Honda (-17.7%)
• Smart (-14.8%)
• Acura (-13.1%)
For the first time this year, GM’s average for a three-month period was in positive territory – up 3.3 percent.
As has been the trend for several months, it’s truck sales that are driving the overall sales advance. Truck sales for the three month period are up +20.5 percent from 2009, while car sales are down by 7.0 percent.
August results
By the time you receive this magazine, or soon thereafter, August sales results and their analysis
will be published in our weekly e-newsletter,
Dealership Digest as well as on our website
www.canadianautodealer.ca. Because of the distorted comparison resulting from the low baseline set in 2009, our monthly reports now contain a column showing this year’s sales, by manufacturer and in total, relative to their average for the past five years.
