Tag Archive | "auto sales"

Lease Volume Reaches Record High in 2016, Edmunds Reports

SANTA MONICA, Calif. — Automotive lease volume reached an all-time high of 4.3 million vehicles in 2016, according to the latest Lease Market Report from Edmunds, account for 31% of new-vehicle sales in 2016. That’s up from 29% in 2015.

Over the past five years, lease volume has grown by 91%. And as the popularity of trucks and SUVs grows — SUV sales surpassed passenger car sales for the first time ever in 2016 — consumers are turning to leasing to help them afford these higher priced vehicles.

“Leasing has long been the gateway for car shoppers who are looking to get a nicer vehicle than they could if they financed,” said Jessica Caldwell, Edmunds executive director of industry analysis. “Because SUVs and trucks are holding their values so well right now, it makes them much more accessible for a much wider swath of the market, further fueling their popularity.”

The average lease payment in 2016 was $120 less than the average finance payment. For large SUVs, the average lease payment was $125 less, and for large pickup trucks the difference was $206, thanks, in large part, to high residual values. Lease terms have hovered at a fairly constant average of 36 months over the past five years, while the average finance term is continuing to creep upward — averaging 69 months in 2016 (compared to 64 months in 2011).

While millennials still only leased 12% of all vehicles leased in the United States in 2016, they opt to lease more proportionally than all other age groups. Nearly one-third of all millennials who purchased a new vehicle in 2016 chose to lease — up from 21% in 2011. Millennials also accounted for the highest share of lessees with a household income under $50,000, which, according to the vehicle information site, presents a significant opportunity for automakers looking to capture the hearts and wallets of these likely first-time car buyers.

“Leasing hits a sweet spot for millennials — they can enjoy the benefits of owning a new vehicle at a low price point with the latest features they crave,” Caldwell said. “If automakers make a positive first impression with this influential group, they have a great opportunity to build lasting relationships as brand loyalty rates are much higher among shoppers who lease vs. buy.”

Luxury brands still capture the most lessees, but brands that have a heavy truck and SUV lineup are starting to play catch up. Brands like RAM, GMC and Chevrolet, which historically had lease penetration rates hovering between five and twelve percent five years ago, have seen lease rates jump more than 100%.

“While we think overall lease penetration will start to level off to 30% in 2017, the shift from passenger cars to trucks and SUVs shows no signs of slowing down,” Caldwell said. “As long as gas prices remain low and residual values on trucks and SUVs stay high, that segment of the lease market is likely to continue to expand this year.”

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NADA: April Auto Sales Continue to Lead Economic Growth

MCLEAN, Va. — Falling gasoline prices and continued pent-up demand have spurred spending on new cars and light trucks, with average retail transaction prices rising more than 3% in the first quarter compared to the same period a year ago, the National Automobile Dealers Association (NADA) reported this week.

The average retail transaction price for a new vehicle was $33,189 through the first quarter.

“Consumers clearly feel confident enough in the economic recovery to make big-ticket purchases,” said NADA Chief Economist Steven Szakaly. “While we’ve seen a pullback in investments in other industries, particularly in oil-related industries, automotive retailing remains a growth industry.”

The NADA has forecasted sales of 16.94 million new-light vehicles for 2015.

“The automotive-retailing sector is continuing to outpace growth in the overall U.S. economy,” Szakaly added. “Economic and employment growth were slower than expected in the first quarter but vehicle sales remain strong.”

The strong summer selling season and the allure of new-vehicle models will likely keep sales humming, despite an expected gradual rise in gasoline prices by about 11% over the next eight months of the year, according to the NADA. This year, the light-truck segment, which includes SUVs, CUVs, minivans and pickup trucks, is expected to outsell cars by 56% to 44%, respectively.

The Fed is expected to delay an interest rate increase, but Szakaly said he believe any increase will likely be small. The NADA now forecasts the Fed to raise rates by just 25 basis points in the fall and 35 basis points by the end of 2015.

“The historically strong spring and summer selling seasons will be driven by new and redesigned vehicles as well as competitive financing rates, which bode well for auto sales over the next several months,” Szakaly added.

Szakaly added that strong consumer demand in the used-vehicle market is keeping trade-in values high, which is another value for car buyers.

“Just like the new-vehicle market, we continue to see healthy demand for used cars,” he said. “Those same factors in the new-vehicle market, which include low financing rates, extra spending money and improving employment opportunities, are driving car buyers to the used-vehicle market as well.”

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U.S. New Auto Sales at Highest Level Since 2006

DETROIT – Sales of new vehicles in the U.S. last year grew by 6 percent to 16,522,000 units, according to AutoData Corp., marking the highest rate since 2006, reported MLive.

For the Detroit Three, sales rose for both General Motors, which sold more vehicles in the U.S. than any other automaker in 2014, and for FCA US, formerly Chrysler Group, which has had 57 straight months of sales growth.

Ford’s sales were flat, although the Dearborn automaker expected a slower pace as it completely retooled some of its facilities for an unprecedented roll-out of a revamped F-150, its best-selling vehicle.

Here’s how the top eight automakers’ sales fared in 2014 vs. 2013, per AutoData Corp.:

  • GM – Up 5.3 % to 2,935,008 vehicles sold
  • Ford – Down 0.6 % to 2,471,315
  • FCA/Chrysler – Up 16.1 % to 2,090,639
  • Toyota – Up 6.2 % to 2,373,771
  • Honda – Up. 1.0 % to 1,540,872
  • Nissan – Up 11.1 % to 1,386,895
  • Hyundai – Up 0.7 % to 725,718
  • Volkswagen – Down 2.9 % to 552,720

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BMW Retakes U.S. Luxury Auto Sales Crown from Mercedes-Benz

BMW on Monday regained bragging rights as the top-selling luxury brand in the United States, ending the one-year reign of German rival Mercedes, reported Reuters.

BMW ended with a lead last year of more than 9,000 vehicles over Mercedes-Benz, which in 2013 seized a title BMW had held for the previous two years.

The BMW brand sold 339,738 vehicles in the U.S. market last year, a 9.8 percent jump from 2013. BMW’s sales growth outpaced the overall U.S. auto market’s 5.9 percent increase. Daimler AG’s Mercedes-Benz brand showed an increase of 5.7 percent to 330,391 vehicles.

Last year, Mercedes-Benz outsold BMW by about 3,000 vehicles. BMW won the sales crown in 2011 and 2012.

Toyota Motor Corp’s Lexus brand narrowed the gap on the two German brands, but remained in third last year with 311,389 vehicles, up 13.7 percent.

From 2000 to 2010, Lexus was the luxury sales leader, but the two German brands jumped the Japanese brand in 2011 when a damaging earthquake and tsunami struck Japan.

Volkswagen AG’s Audi brand overtook General Motors Co’s Cadillac for fourth place. Audi’s sales of 182,011 were up 15.2 percent while Cadillac sales fell 6.5 percent to 170,750 vehicles.

Honda Motor Co’s Acura brand showed a 1.5 percent gain in the year to 167,843 vehicles, followed by Nissan Motor Co’s Infiniti at 117,300 vehicles, up 0.8 percent.

In eighth place but gaining was Lincoln, the Ford Motor Co luxury brand that a couple of decades ago was the luxury market leader. Lincoln’s sales rose 15.6 percent in the year to 94,474 vehicles.

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A1 Software Announces Mobile Focused CRM

SAN JOSE, Calif. — A1 Software Group announced its new dealership CRM, Selly, a mobile focused, lightweight CRM for automotive sales. Selly is designed for small to medium sized dealerships and was initially distributed as a mobile app.

“The majority of vendors have built complicated systems that have been selling for years with minimal updates and modernization,” said Zach Klempf, CEO of A1 Software Group. “Selly for Automotive will have a simple SaaS pricing structure at a fraction of the cost of other dealership CRM tools.”

Selly automates much of the data entry process by using social media integration and is accessible through the cloud or offline. Because of the mobile nature of the software, the CRM can be used while out in the lot. It is also localized in nine different languages to cater to bilingual sales reps.

A1 is currently looking for small and medium sized dealerships to participate in the beta test for Selly. In order to participate in the program, visit SellyDealer.com.

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U.S. November Auto Sales Pace Best Since 2003

The top six automakers sold more cars and trucks in November than analysts expected, with a healthy economy, generous discounts and low fuel prices luring consumers into U.S. showrooms, reported Reuters.

The industry’s annualized sales rate in November was about 17.2 million vehicles, according to industry consultant Autodata Corp. That is the best pace for that month since 2003 and well ahead of the estimated 16.7 million in a Thomson Reuters survey of 41 industry economists and analysts.

November sales totaled 1.3 million, up 4.6 percent from a year ago and higher than analysts’ expectations of 1.27 million.

“This sustained demand for new vehicles was building for years during the recession, and it should continue unless a major shift in economic stability occurs,” said analyst Karl Brauer of Kelley Blue Book.

General Motors Co, Chrysler Group, Toyota Motor Corp and Honda Motor Co all reported year-to-year sales gains in November, while Ford Motor Co and Nissan Motor Co Ltd had modest declines. All six topped forecasts from analysts surveyed by Reuters.

Early buzz and promotions tied to the post-Thanksgiving “Black Friday” retail blitz helped spur car sales, according to John Krafcik, president of online shopping service TrueCar.com. Krafcik said average transaction prices on full-size pickups in November topped $40,000 for the first time.

GM on Tuesday said November sales rose 6.5 percent to 225,818 vehicles. Sales of GM’s Chevrolet Silverado and GMC Sierra full-size pickups climbed 34 percent to 65,343.

“Lower gasoline prices are helping the entire market, not just SUVs and trucks,” said GM spokesman Jim Cain, who also cited improving consumer confidence, higher wages and lower unemployment.

Chrysler Group sales rose 20.1 percent to 170,839 vehicles on strong showings by its Jeep utility vehicles and Ram trucks. Ram pickup sales were up 21 percent, while Jeep SUV sales jumped 27 percent.

Ford reported a slight decline in sales to 186,334 vehicles, about what analysts had expected. Sales of the best-selling F-150 pickup were down 10 percent to 59,049 as the automaker began a changeover to the redesigned 2015 model.

Ford chief economist Emily Kolinski Morris said plunging fuel prices have provided a “financial windfall” for buyers, bolstered by still-low interest rates.

“By any measure, households are reaping significant disposable income gains each week at current gas prices,” she said.

Toyota said sales rose 3 percent to 183,343, while Honda reported an increase of nearly 9 percent to 121,814. Nissan said sales were down 3 percent to 103,188. All three companies beat analysts’ expectations.

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