Auto sales bracing for July cooldown, analysts say
Automakers are expected to report a decline in July sales, following a blockbuster month of June.
Analysts at car-shopping website Edmunds forecast industry-wide monthly sales of nearly 1.38 million new cars, trucks and SUVs. That would mark a 2.3% drop compared to July 2017, which benefited from one extra selling day.
July auto sales also faced headwinds from an unseasonably strong run in June. Sales growth in June “may have played a role in pulling ahead sales,” Edmunds noted.
The website said the industry saw robust demand during Fourth of July promotions, but sales tapered off in the second half of the month.
“July sales are looking reasonably strong, but we’re starting to see the first signs of speed bumps on the road ahead,” Jeremy Acevedo, manager of industry analysis at Edmunds, said in a news release. “With market factors such as rising interest rates keeping shoppers at bay, we expect to see a continued slowdown of the vigorous sales pace that the industry experienced in the first half of the year.”
Edmunds predicted that every major automaker except for Fiat Chrysler and the Volkswagen-Audi group will report weaker July sales. Manufacturers will release sales figures Wednesday.
Cox Automotive, the parent company of Kelley Blue Book and Autotrader, estimated a slightly stronger total for the industry at 1.41 million vehicles, roughly flat versus year-ago levels.
Charles Chesbrough, senior economist at Cox Automotive, said the threat of higher vehicle prices from rising interest rates and potential trade tariffs “may be driving more shoppers to the showrooms now.”
In their joint forecast, J.D. Power and LMC Automotive said new-vehicle retail sales – deliveries made by dealers to consumers – are on pace to drop 7.1% in July. Still, automakers likely cut back on incentive spending for the first time in 54 months, the report said.