New Car Auto Sales Expected to be Down for July While SAAR Continues to Fluctuate in 2019
SANTA MONICA, Calif.,
“Despite buoyant market fundamentals, auto sales are being pulled back by lower incentives,” said Oliver Strauss, Chief Economist for ALG, a subsidiary of TrueCar. “SAAR however has fluctuated in 2019 more than in previous years, pointing to some uncertainty about the remainder of the year.”
Additional Takeaways & Trends: (Forecasted by ALG)
- Despite industry sales being down year-over-year, Hyundai had a strong month, up 6.2%. Trends on the TrueCar platform indicate that Hyundai is increasingly winning over new car buyers who are cross-shopping other brands, particularly buyers who are also considering Toyota and Subaru models.
- Tesla continued its sales ascent, up 67.5% year-over-year driven by Model 3 sales.
- Automaker average incentive spend will reach
$3,671, down 2.6% or $97 dollarsyear-over-year, and down 4% or $151from June 2019. The most notable declines in incentive spend will come from Kia, down 17.8%, Toyota, down 9.3%, and Subaru, down 9.1% year-over-year. Meanwhile Honda raised incentives by 4.2% and BMW by 3.4%.
- Average transaction price (ATP) should continue to rise, up 2.7% or
- Incentives as a percentage of average transaction price are expected to be 10.8%, down 5.1% from a year ago and down 2.8% from
- Volkswagen and Mercedes stood out this month in ALG’s brand strength metric for mainstream and luxury brands respectively, largely driven by new or redesigned product. Volkswagen’s Tiguan received a major refresh for 2019 and the Atlas was added as a new model to the Volkswagen line-up. Mercedes was buoyed by the all-new GLE SUV and its new entry level, A-Class Sedan.
- Used vehicle sales for July are expected to reach 3,331,762 down 0.8% year-over-year and flat from
“With a tightening of consumer demand and automaker incentives, savvy car buyers are likely holding out in anticipation of better deals or widening their consideration set to get the most value,” said Eric Lyman, Chief Industry Analyst at ALG, a subsidiary of TrueCar. “Hyundai has been a prime example of this trend, they’ve been able to capture sales in a declining sales environment by attracting shoppers from other brands.”
Retail Health Index (Forecast)
RHI measures the changes in retail market share relative to changes in incentive spending and transaction price to gauge whether OEMs are "buying" retail share through increased incentives, or whether share increases are largely demand-driven. An OEM with a positive RHI score is demonstrating a healthy balance of incentive spend relative to market share, either by holding incentive spending flat and increasing share or by increasing incentives with a higher positive increase in retail share.
ALG's Retail Health Index - Mainstream
ALG's Retail Health Index - Luxury
Total Unit Sales
|Manufacturer||July 2019||July 2018||YoY %
Incentive Spending (Per Unit)
|Manufacturer||July 2019||July 2018||YOY %
Average Transaction Price (ATP)
|Manufacturer||July 2019||July 2018||June 2019||YOY %
For additional data visit the ALG Newsroom.
(Note: This forecast is based solely on ALG’s analysis of industry sales trends and conditions and is not a projection of the company’s operations.)
Founded in 1964 and headquartered in Santa Monica, California, ALG is an industry authority on automotive residual value projections in both the United States and Canada. By analyzing nearly 2,500 vehicle trims each year to assess residual value, ALG provides auto industry and financial services clients with market industry insights, residual value forecasts, consulting and vehicle portfolio management and risk services. ALG is a wholly-owned subsidiary of
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Source: TrueCar, Inc.