"Given all the positive economic news, including a high stock market and low unemployment rates, we might have expected even more, particularly compared to last August which was negatively impacted by Hurricane Harvey," Charlie Chesbrough, senior economist for Cox Automotive, said in a statement. "This is why we believe all the positive economic news can't overtake the worsening buying conditions for consumers: The economy may be peaking right now, but the vehicle market likely peaked two years ago."
Through August, U.S. sales are on pace for a full-year total of 17.4 million. Most analysts predict sales in the final third of the year will taper off and result in a full-year total somewhere between the high 16 millions and last year's 17.2 million.
The industry is "clearly on the downslope post peak," Morgan Stanley analyst Adam Jonas said in a note to investors last week. "We'll need more incentives and higher fleet mix just to stand still."
Falling all cars
| Percent of car sales of the North American market. |
| August 2013 | 50.10% |
| August 2014 | 47.60% |
| August 2015 | 43.00% |
| August 2016 | 38.50% |
| August 2017 | 35.50% |
| August 2018 | 28.80% |
But most automakers, pleased by transaction prices that keep rising and well aware of how profit-killing discounts helped spiral the industry into its last downturn, have been loath to throw more cash on the hood, especially on the sedans and other cars that become less popular every month.
Incentives rose just $26 a vehicle, or 0.7 percent, from a year ago in August, according to ALG, while the average transaction price jumped $549.
"Automakers have done a decent job this year at aligning inventory with demand, so there's no need for dealers to have a fire sale," Jeremy Acevedo, manager of industry analysis at Edmunds, said in a statement. "Manufacturers seem to be more comfortable with a longer selldown period that leverages targeted incentives, instead of an aggressive 'everything must go now' mentality."
General Motors actually ratcheted down its incentive spending last month, resulting in an estimated 13 percent sales decline, according to the Automotive News Data Center.
Car sales skidded 19 percent in August while light-truck volume rose 10 percent. Cars represented just 28.9 percent of the market last month, a record low for any month.
