New vehicle sales in the United States in July are expected to decrease 1% year on year to 1.5m units in July 2016, resulting in an estimated 17.5m seasonally adjusted annual rate (SAAR), according to Kelley Blue Book.
Following weaker than anticipated sales in June, KBB analysts expect new car sales to bounce back to the mid-17m SAAR range in July, helped by a strong Fourth of July weekend, increased incentives and continued growth in leasing. Sales in the first half of the year totaled 8.6m units, which was the highest first-half volume since 2001.
"The new-car market currently appears to be reaching its peak in terms of sales, and now there is a better chance that 2016 won't be another record year, as year-over-year comparisons for the remainder of 2016 will be tough," said KBB analyst Tim Fleming. "After a record new-car sales total in the United States in 2015, [our] full-year forecast for 2016 now calls for sales in the range of 17.4m to 17.8m, which would range anywhere from a slight year-over-year decline to a 2% increase."
KBB said General Motors could see one of the biggest volume declines of the major manufacturers in July, an expected 4%. Much of that can be attributed to a drop in rental sales, as GM continues to focus on increasing retail share. However, to drive new sales, GM also has increased incentive spending, with the average climbing to nearly US$4,000 per unit.
Nissan North America could gain the most market share in July, with a projected 4% increase in volume, due to strong months from the Frontier and Rogue. The Frontier is benefiting from being in the hot mid-size pickup segment, while the Rogue could surpass the Altima as Nissan's top seller in July.
Rival Edmunds.com, meanwhile, forecast a 1.52m-unit new cars and trucks July for an estimated SAAR of 17.8m. This would be up 0.7% over June 2016, and a 0.8% increase versus July 2015. Its forecast anticipates that it will be the best July since 1.8m sales were registered in July 2005.
Edmunds.com also projected that 10,159,636 new cars and trucks will be sold this year in the US to the end of July, up 1.3% from 10,028,814 in record-breaking 2015.
"Last year's record-setting sales performance was powered primarily by a strong second half, and July sales suggest that 2016 is poised to play out in the same way," said Edmunds' executive director of industry analysis Jessica Caldwell. "With low interest rates and a leasing market that's stronger than ever, automakers have a great opportunity to build on last year's burst of summer sales. The growth might not be as significant as in recent years, but it's still growth nonetheless."