December U.S. sales predicted to be strong but down from 2016

December is projected to produce the highest U.S. new-vehicle sales volume of the year, but it won't be enough for 2017 to top last year's record-setting total.Sales this month are expected to be down nearly 6 percent from December 2016, according to forecasts from Edmunds and LMC-J.D. Power, even though incentives rose significantly from a year ago. That would mean November was the only month of 2017 in which sales increased year-over-year and would officially end the industry's growth streak that started in 2010.Both forecasts call for December sales of about 1.59 million vehicles, which would result in a full-year total of 17.23 million, 1.8 percent less than the 17.55 million sold in 2016. It would make 2017 the U.S. industry's fourth-best year in history, behind 2016, 2015 and 2000."Auto sales got off to a sluggish start in 2017 but managed to finish in a fairly decent place," Jessica Caldwell, Edmunds' executive director of industry analysis, said in a statement."Even though December sales were down year over year, we expect it to be the highest volume month of 2017. Shopper traffic to dealerships really picks up once we get on the other side of the Christmas holiday as automakers pull out all the stops to eke out every last sale before the end of the year."December tends to be a fairly unpredictable month because so much of its volume happens during the week after Christmas, when automakers and dealers are pushing to make their year-end goals and many consumers have time off from work. Transactions that close by the end of Jan. 2 will count toward 2017 based on the way the industry divides the calendar; automakers are scheduled to report their final 2017 sales results Jan. 3. December has 26 selling days -- one fewer than it did last year.Although volumes are lower than a year ago, the industry's average transaction price will climb to a December record of more than $32,900 this month, 2.7 percent more than a year ago, according to J.D. Power. But incentive spending is up 7.5 percent from a year ago to $4,302 per vehicle, a record for any month.The LMC-J.D. Power forecast notes that more than half of the year's decline from 2016 is due to a pullback in fleet sales, with retail volume down a smaller amount."While 2017 retail sales will be below 14 million units, this year will still rank as the eighth-best retail sales year in history," said Thomas King, senior vice president of J.D. Power's data and analytics division. "The larger concern remains the elevated incentives being used to drive the current sales pace."All major automakers will post lower sales in December than a year ago, including double-digit declines for Volkswagen Group of America and Hyundai-Kia, according to Edmunds' forecast.It expects General Motors and Ford Motor Co. to gain market share as Toyota Motor Sales U.S.A., FCA US, Hyundai-Kia and VW lose share. American Honda and Nissan North America will post sales declines in line with the industry average, making their shares even with a year ago, Edmunds predicted.

December U.S. sales predicted to be strong but down from 2016

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