TrueCar Finds July Auto Sales Simmer as Summer Heats Up and Slows Consumer Traffic

Retail deliveries experience a slight decline of 0.7%

SANTA MONICA, Calif.--(BUSINESS WIRE)--TrueCar, Inc. (NASDAQ: TRUE) projects total new vehicle sales, including fleet deliveries, will reach 1,505,200 units in July, down by 0.4 percent from a year ago.

That level of growth would push the seasonally adjusted annualized rate (SAAR) for total light vehicle sales to an estimated 17.7 million units for the month, up from a 17.6 million-unit SAAR a year ago. Excluding fleet sales, U.S. retail deliveries of new cars and light trucks should decline 0.7 percent to 1,318,200 units based on some soft spots in consumer demand.

“An exceptionally hot July has tempered retail sales with some consumers electing to stay indoors and off dealership showrooms,” said Oliver Strauss, TrueCar’s chief economist and forecaster. “However, a few automakers are experiencing mild retail growth. General Motors is offering a compelling summer sales event with vehicles up to 20 percent off MSRP, meanwhile Kia Motors America is offering zero percent financing for up to 66 months, both enticing consumers to battle the heatwaves.”

Kia Motors America may report the biggest year-over-year retail sales gain, as it is currently on pace for a 7 percent rise in volume. GM will likely follow with a 2.9 percent retail sales increase. Nissan Motor Co. may post the third-biggest gains, with a 1 percent increase in retail sales.

Total volume for non-luxury, mass-market brands will likely be down by 0.4 percent versus last year, while sales of luxury models may decline by 0.6 percent. Both compact crossover and large utility vehicles remain in high-demand in July and will be among the industry’s biggest volume segments.

Incentive spending by automakers averaged an estimated $3,225 per vehicle in July, up 5.2 percent from a year ago, though down 0.2 percent from June 2016.

“The most recent positive news about the U.S. labor market in combination with resilient consumer confidence continue to provide upbeat signals about the health of the U.S. economy,” Strauss said. “Concerns in regards to “Brexit” and the outcome of the U.S. presidential election in November have perhaps taken a bit of a backseat. Yet the U.S. Fed remains cautious before possibly making an adjustment to the Federal Funds Rate. Overall, we remain optimistic that 2016 industry light vehicle sales will beat last year’s performance.”

The Conference Board Consumer Confidence Index is relatively unchanged in July at 97.3, down from 97.4 in June and overall U.S. economic conditions remain healthy. June’s unemployment rate was 4.9 percent, the lowest for that month in eight years, while gasoline prices remain favorable for consumers, falling to a national average of $2.15 per gallon on July 26 from $2.72 a year earlier.

Other key findings for July:

• Registration mix is expected to be 87.6 percent retail sales and 12.4 percent fleet versus 87.8 percent retail and 12.2 percent fleet last July.
• Total used auto sales, including franchise and independent dealerships and private-party transactions, may reach 3,441,581, up 4 percent from July 2015.

Forecasts for the 12 largest manufacturers by volume:

Total Unit Sales

Manufacturer	July 2016 Forecast	July 2015	% Change vs. July 2015 (Daily Selling Rate)
BMW	31,000	32,234	-3.8%
Daimler	30,200	30,131	0.2%
FCA	180,100	178,984	0.6%
Ford	223,300	222,014	0.6%
GM	272,000	272,512	-0.2%
Honda	145,800	146,324	-0.4%
Hyundai	69,700	71,013	-1.8%
Kia	61,700	56,311	9.6%
Nissan	133,800	130,872	2.2%
Subaru	48,000	50,517	-5.0%
Toyota	208,200	217,181	-4.1%
Volkswagen Group	48,800	53,982	-9.6%
Industry	1,505,200	1,511,261	-0.4%

Total Market Share

Manufacturer	July 2016 Forecast	July 2015	June 2016
BMW	2.1%	2.1%	2.2%
Daimler	2.0%	2.0%	2.1%
FCA	12.0%	11.8%	13.1%
Ford	14.8%	14.7%	15.8%
GM	18.1%	18.0%	16.9%
Honda	9.7%	9.7%	9.2%
Hyundai	4.6%	4.7%	4.5%
Kia	4.1%	3.7%	4.1%
Nissan	8.9%	8.7%	9.3%
Subaru	3.2%	3.3%	3.1%
Toyota	13.8%	14.4%	13.1%
Volkswagen Group	3.2%	3.6%	3.1%

Retail Unit Sales

Manufacturer	July 2016 Forecast	July 2015	% Change vs. July 2015 (Daily Selling Rate)
BMW	30,000	31,816	-5.7%
Daimler	28,600	29,033	-1.5%
FCA	151,900	158,600	-4.2%
Ford	169,200	170,044	-0.5%
GM	231,600	224,984	2.9%
Honda	143,900	144,715	-0.6%
Hyundai	55,700	56,487	-1.4%
Kia	52,400	48,992	7.0%
Nissan	113,000	111,893	1.0%
Subaru	45,500	49,239	-7.6%
Toyota	201,700	203,392	-0.8%
Volkswagen Group	46,300	51,133	-9.5%
Industry	1,318,200	1,326,869	-0.7%

Incentive Spending

Manufacturer	Incentive per Unit July 2016 Forecast	Incentive per Unit % Change vs. July 2015	Incentive per Unit % Change vs. June 2016	Total Spending July 2016 Forecast
BMW	$5,178	24.7%	-4.2%	$159,996,931
Daimler	$4,538	-5.1%	-4.4%	$137,034,668
FCA	$3,996	13.0%	-1.6%	$715,303,433
Ford	$3,632	20.3%	-1.3%	$811,080,602
GM	$4,338	1.9%	6.8%	$1,180,061,667
Honda	$1,794	-11.6%	4.3%	$261,611,907
Hyundai	$2,328	-12.7%	1.6%	$162,275,897
Kia	$2,699	-10.7%	-0.3%	$166,513,998
Nissan	$3,439	-3.9%	-0.4%	$460,085,014
Subaru	$644	-7.5%	1.9%	$30,898,070
Toyota	$2,228	4.7%	-2.7%	$463,765,798
Volkswagen Group	$3,796	22.9%	0.0%	$184,122,187
Industry	$3,225	5.2%	-0.2%	$4,840,937,306

(Note: This forecast is based solely on TrueCar’s analysis of industry sales trends and conditions and is not a projection of the company’s operations.)

About TrueCar

TrueCar, Inc. (NASDAQ: TRUE) is a digital automotive marketplace that provides comprehensive pricing transparency about what other people paid for their cars and enables consumers to engage with TrueCar Certified Dealers who are committed to providing a superior purchase experience. TrueCar operates its own branded site and its nationwide network of more than 11,000 Certified Dealers also powers car-buying programs for some of the largest U.S. membership and service organizations, including USAA, AARP, American Express, AAA and Sam's Club. Over one third of all new car buyers engage with the TrueCar network during their purchasing process. TrueCar is headquartered in Santa Monica, California, with offices in San Francisco and Austin, Texas. For more information, go to www.truecar.com. Follow us on Facebook or Twitter.

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