Automakers' U.S. incentive spending is on pace to decline this month for the first time since early 2014, according to data from J.D. Power and LMC Automotive, despite projections that overall new-vehicle demand will weaken in July and the second half of the year.
U.S. car and light-truck sales are projected to be flat or down in July, forecasts from J.D. Power/LMC, Edmunds and Cox Automotive show. That would be only the third monthly year-over-year drop in 2018.
The forecasts for July are more varied than usual and call for a seasonally adjusted, annualized sales rate of 16.1 million to 17.1 million. A 16.1 million SAAR, as J.D. Power/LMC projects, would be the lowest rate recorded since February 2014. Anywhere in that range would fall below the June rate of 17.47 million.
While U.S. employment growth and consumer confidence remains high, elevated gasoline prices and rising interest rates are expected to dampen second-half volume.