April auto retail sales of new light vehicles in the U.S. are expected to reach their highest levels for the month of since 2005 at 1.1 million units. This is 5% higher than in April 2013. The seasonally adjusted annualized selling rate (aka SAAR) is expected to be 13.3 million units, more than 700,000 units higher than a year ago.
J.D. Power, the source of the soothsaying, estimates that consumers will spend $33.5 billion purchasing new vehicles this month, a historic record level for the month of April. The previous April high was $30.5 billion in 2005.
Buyers 35 years of age and younger are expected to account for 25% of new-vehicle retail sales in April, a rebound to pre-recession levels. However, nearly one-third of new vehicles sold in April will be financed with a loan of 72 months or longer, with younger buyers in particular using the longer-term loans to manage their monthly payments.
“Among buyers who are 35-years old and younger, 44% opt for 72-month or longer loans, while only 25% of those who are 55 years and older use an extended loan term,” said John Humphrey of J.D. Power.
Total light-vehicle sales in April 2014 are expected to reach 1.4 million units, a 4% increase from April 2013. Fleet sales are forecasted to increase 3%, compared with April 2013, with fleet share of total light-vehicle sales remaining below 20%. Fleet sales through April are projected to be down nearly 6% from the same time in 2013. For the full year, retail sales growth is expected to outpace fleet market growth.
LMC Automotive has increased its production forecast for 2014 by 100,000 units to 16.6 million, a 3% increase from 2013. Much of the growth is due to a 21% increase in premium vehicle production, compared with 2013.
