This month -- powered by Black Friday sales and a strengthening economy -- could be the best November ever for U.S. auto sales, according to forecasts from TrueCar and Edmunds.com, and also may mark the first time in history that the industry’s seasonally adjusted, annualized selling rate has topped 18 million units for three consecutive months.
Two other forecasts are calling for sales to be flat or down slightly from a year ago, if only because this November has two fewer selling days.
But if even the more conservative projections are accurate, it would take an extremely weak December for 2015 to avoid beating the all-time high of 17.402 million, which was set in 2000. LMC Automotive said it is increasing its forecast for the year by 200,000 units to 17.5 million.
“U.S. auto sales are now clearly on the path to set a record in 2015, with volume we haven’t seen in 15 years,” Jeff Schuster, LMC’s senior vice president of forecasting, said in a statement. “Even with the strong possibility for the Fed to increase interest rates, growth should continue into 2016, with sales expected to reach 17.8 million units.”
TrueCar estimates that sales will rise 3.9 percent this month from November 2014, which had two more selling days and one additional weekend. It projects a SAAR of 18.6 million, which would be the fifth-highest monthly rate ever. Edmunds projects a sales increase of 2.5 percent and a SAAR of 18.3 million, which would still be a 10-year high.
Kelley Blue Book said it’s expecting flat sales from a year ago and a SAAR of 17.8 million, while LMC is forecasting a 1.5 percent decline and a SAAR of 17.7 million. The SAAR was 17.1 million in November 2014 and 18.2 million last month.
“This month continues to be a standout year for the industry, with November sales likely setting a monthly record,” Eric Lyman, TrueCar’s vice president of industry insights, said in a statement. “Consumers are excited about Black Friday promotions, and these month-long events appear to be resonating with car buyers. Brands that advertised early, Chevrolet, Hyundai, Jeep and Ram, are expected to outperform the industry.”
Black Friday -- the day after Thanksgiving, when most retailers open early and shoppers line up for deep discounts -- now marks the beginning of a huge weekend for car dealerships. Edmunds said Thanksgiving weekend accounted for twice as many sales as any other November weekend last year.
So much of November’s tally hinges on transactions that haven’t happened yet, which is why the forecasts vary significantly. This November has the fewest selling days of any month this year, 23, while December has the most, 28.
“Not even a decade ago, November was a notoriously slow sales month, and it typically ranked as the third worst month for sales in the calendar year,” Jessica Caldwell, Edmunds’ director of industry analysis, said in a statement. “But in recent years, car dealers have joined other retailers to embrace Black Friday as a big sales driver. Since 2010, November has delivered one of the three best SAARs in each year.”
Incentives rising
Incentive spending is up 6 percent from November 2014, according to TrueCar, but down 1.1 percent from October, despite the deals now being advertised.
The company with the biggest incentive increase from a year ago is Volkswagen Group of America, which has upped discounts by 27 percent in a bid to keep showroom traffic up in the wake of its diesel emissions scandal. Fiat Chrysler Automobiles and Hyundai both increased incentives by 13 percent.
At the same time, J.D. Power data shows that the industry’s average transaction price so far this month, $31,498, is the highest ever for November and the second highest for any month, behind only last December.
“Automakers are striking while current economic fundamentals are favorable,” Stacey Doyle, TrueCar’s senior industry analyst, said in the company’s statement. “With unchanged interest rates, low unemployment and consumer-friendly gas prices, manufacturers are willing to spend slightly more to reap large rewards.”
Strong gains for GM
General Motors is expected to post one of the biggest year-over-year gains, according to TrueCar and KBB, though Edmunds projects GM to lose market share.
All three estimates show Ford Motor Co. increasing its share. Sales may fall slightly for American Honda, according to the Edmunds and KBB forecasts. KBB also shows Toyota Motor Sales posting a decline, but TrueCar and Edmunds project Toyota will achieve an above-average increase.
TrueCar said the VW Group will manage a small sales gain, but KBB and Edmunds expect it to post a large drop. Edmunds projects sales by the VW brand will plunge 27 percent.
