As questionable sales practices by the U.S. auto industry were thrust into the spotlight last year amid federal investigations into Fiat Chrysler’s reporting, the difference between industry sales and actual registrations of vehicles considerably narrowed.
A wide gap can be an indicator of possible fudging of sales stats by “punching,” practices such as dealers selling cars to their sales fleets, selling them as used later on. It raises questions about the legitimacy of sales reports, which can influence the value of automakers’ stock, affect executive bonuses and even factor into closely watched U.S. economic indicators.
According to data from IHS Markit and the Automotive News Data Center, there was a less than 1 percent difference in new vehicle registrations by state and overall reported sales by automakers in 2016 — a roughly 1 percentage point decrease from 2015 and the lowest differential since 2008.
While there’s no direct correlation that can be made to the increased attention to sales reporting and the state-reported registration data collected by IHS, some automakers may have tightened their standards on what is tallied as a “sale.”
Last year’s 0.66 percent difference marked the most significant decline in more than a decade and only the second decrease during the auto industry’s seven consecutive years of growing sales, including record-setting U.S. light-vehicle sales the past two years.
