DETROIT -- U.S. auto sales are projected to increase as much as 5 percent in December, according to several analysts’ forecasts, with most of the purchases taking place in the week after Christmas.
The forecasts call for light-vehicle sales of about 1.4 million vehicles this month, which would result in full-year sales of more than 15.6 million units. That would represent an 8 percent jump from the 14.5 million vehicles sold in 2012.
“Similar to November, sales will be heavily skewed toward the final week of the month as automakers and dealers try to beat year-end sales targets,” Alec Gutierrez, senior analyst for Kelley Blue Book, said in a statement. “For consumers, this is generally the best time of year to purchase a new vehicle. Dealers are trying to clear remaining 2013 model-year stock, which is 26 percent of current inventory, according to AutoTrader.com listings.”
KBB said it expects December sales to be 5 percent higher than a year ago, resulting in a seasonally adjusted annualized selling rate of 16 million. That would be lower than the November rate of 16.4 million but still the third-highest of the year. The industry SAAR was 15.3 million in December 2012.
Edmunds.com also projects a 5 percent increase in December light-vehicle demand, with a SAAR of 16.1 million.
LMC Automotive released a more conservative estimate, projecting a 3 percent increase in volume for the month and a December SAAR of 15.3 million.
“The budget deal in Washington is helping fuel a higher level of optimism for the economy and auto sales in 2014,” Jeff Schuster, senior vice president of forecasting at LMC, said in a statement. “December sales faced some challenge early in the month, with some sales that pulled ahead in November and winter storms, they have rebounded well, and the year ahead is set up to edge new-vehicle sales closer to pre-recession levels.”
Government data released today showed that the economy grew in the third quarter at the fastest rate since 2011 and that the unemployment rate fell in all but five states last month as the national jobless rate hit a five-year low of 7 percent.
In addition, lower gas prices are bolstering demand for larger vehicles, analysts say.
Sales generated through Jan. 2 will be included in December and 2013 totals, which automakers will report on Jan. 3.
December has 25 selling days this year, one fewer than it did in 2012.
“Everything I’m hearing about December is that it’s been a great month,” said Jesse Toprak, president of Toprak Consulting.
LMC said it expects retail sales to account for 84 percent of December deliveries, compared with 82 percent year-to-date. LMC said it expects average transaction prices to rise about $500 from a year ago, resulting in total consumer spending on new vehicles of $34 billion in December, a record for that month.
It projected total retail sales for the year of 12.8 million vehicles, about 1 million more than in 2012, with consumers spending about $375 billion on new vehicles this year, a $40 billion increase.
LMC said it increased its 2013 North American production forecast to 16.2 million units. Through November, production was up 5 percent on the year, an increase of nearly 700,000 units. LMC now projects 2014 production of 16.6 million, 3 percent more than its full-year 2013 estimate.