IRVINE, Calif., /PRNewswire/ — New-vehicle sales are expected to decrease 2 percent year-over-year to a total of 1.6 million units in December 2016, resulting in an estimated 17.4 million seasonally adjusted annual rate (SAAR), according to Kelley Blue Book www.kbb.com, the vehicle valuation and information source relied upon by both consumers and the automotive industry.
“December is shaping up to be the biggest sales month of 2016, even though it will likely fall short of last year’s record results,” said Tim Fleming, analyst for Kelley Blue Book. “At year-end, 2016 light-vehicle sales should total 17.4 million, just 0.1 percent short of 2015’s record year. Sales for the month will be boosted by plentiful retail incentives featured in many holiday sales events across the country, and one last push to hit year-end sales objectives.”
Kelley Blue Book expects further slowdowns in 2017, and its experts’ forecast calls for sales in the range of 16.8 to 17.3 million, which would represent a 1 to 3 percent decrease from this year.
“Substantial incentive hikes this year haven’t resulted in retail growth, while inventories continue to grow,” said Fleming. “An increasing supply of used cars, especially off-lease units, is already putting pressure on residual values, which could impact the sustainability of today’s high levels of leasing. We are looking for manufacturers to cut production in the new year to better match slowing consumer demand and alleviate the need for elevated incentives.”
General Motors performing better than most with its mid-size cars
General Motors could report the greatest volume increase in December 2016 and Kelley Blue Book projects a 1 point increase in market share. In contrast to most automakers, General Motors’ growth is highlighted by a mid-size car, the Chevrolet Malibu. The new generation of Malibu has been well-received by critics, and is one of just two mid-size cars to increase sales volume this year.
Hyundai-Kia also could capture share this month and increase sales by 3 percent. However, much of the increase can be attributed to an expected increase in fleet sales, similar to the rest of the calendar year. After all numbers are tallied, Kelley Blue Book expects Hyundai-Kia’s total fleet sales to be up 20 percent in 2016, which is one of the highest increases in the industry.
Cars Down 10 Percentage Points Since 2012
Mid-size SUVs and crossovers are on pace to be one of the fastest growing segments in December 2016, helped by moderate gas prices and seemingly limitless consumer demand for utility vehicles. The Toyota Highlander, Subaru Outback and new GMC Acadia could see some of the biggest increases in the segment.
On the flip side, mid-size cars will have yet another down month, the 10th in a row, and analysts expect the segment’s market share to dip nearly a full percentage point. Overall market share for all cars looks like it will end the year around 39 percent, down from 42 percent in 2015 and down 10 points since 2012. As the industry heads into 2017, there is no indication that this trend will slow.
