July U.S. auto sales will rise 20%, match June rate, J.D. Power says
DETROIT (Reuters) -- July U.S. auto sales will rise about 20 percent from last year but be roughly the same as last month, at 14.1 million on a seasonally adjusted annualized basis, J.D. Power and LMC Automotive said today.
Sales in July have been strong for small and midsize sedans, which are expected to rise 28 percent, the consultants said. All major model groups except for mid-sized crossover SUVs have shown year-over-year sales gains.
If the forecast is realized when auto sales are released by major automakers on August 1, it would be the sixth time in the last seven months that monthly sales topped 14 million on the seasonally adjusted annualized basis used as a key barometer of industry health.
In 2011, U.S. auto sales were 12.8 million. While the June and July annualized sales rate are both 14.1 million, July's new-vehicle sales will be about 115,000, or about 9 percent, lower than June's sales.
Long-term and more available financing is helping new-vehicle sales. J.D. Power-LMC said that in July, 30 percent of new-vehicle sale loans were for 72 months or longer, up from 27 percent last July.
"Long-term financing is a key driver in sales growth," said John Humphrey of J.D. Power. "Loan terms and credit availability are bringing consumers back into the market who have been shut out since the recession began in 2008."
J.D. Power-LMC maintained their forecast for full-year light vehicle sales at 14.5 million.
Jeff Schuster of LMC said sales may drop if the U.S. labor market weakens.
Vehicle inventory in July rose to 58 days of supply from 52 days of supply in June. North American auto production is forecast at 14.9 million vehicles, which would be the highest level since 2007, and a 14 percent increase from 2011, Schuster said.