New vehicle sales are expected to end the year on a strong note, with December 2017 sales expected to show a 14% increase from November 2017, according to Edmunds.com, which forecasts that nearly 1.6 million new cars and trucks will be sold in the U.S. this month. While the month-to-month increase is impressive, the sales will be down 5.8% compared to December 2016, which was a record month for the automotive industry. Based on its forecast for December, Edmunds expects full-year new-vehicle sales to reach 17.2 million in 2017.
Looking Ahead To 2018 Auto Sales
Analysts, across the board, are predicting relatively flat auto sales across the country in 2018, Morgan Stanley expects U.S. auto sales to drop by about 5% to 16.5 million units and the trend toward leasing to continue (and possibly accelerate) as consumers try to avoid locking into long-term ownership of a vehicle.
UBS lowered its 2018 U.S. auto sales estimate to 17.1 million, from 17.2 million, to reflect a drop-in demand as many consumers made purchases to replace vehicles lost in the widespread flooding earlier in 2017.
Bloomberg notes that rates on auto loans have risen about 30 basis points in 2017. If that trend continues, vehicle affordability could become a challenge 2018.
Nomura estimates U.S. light vehicle sales of 17.3 million units in 2018, up 1% year-over-year, based on expectations of an improving economy, healthy labor market and low oil prices.
The National Automobile Dealers Association (NADA) forecasts sales of 16.7 million new cars and light trucks in 2018, as demand for light trucks, SUVs and crossovers continues to be very healthy. NADA also predicts new car dealerships will sell 15.3 million used vehicles in 2018, up from an estimated 15.1 million used vehicles sold in 2017.