SANTA MONICA, Calif.– New vehicle sales will reach 1,170,856 units in February 2021, down 7.6% from a year ago when adjusted for the same number of selling days, according to a new forecast from TrueCar.
February’s seasonally adjusted annualized rate (SAAR) for total light vehicle sales is an estimated 15.5 million units. Excluding fleet sales, TrueCar said it expects U.S. retail deliveries of new cars and light trucks to be 967,545 units, a decrease of 0.4% from a year ago when adjusted for the same number of selling days. Used vehicle sales for February 2021 are expected to reach 3.5 million, down 4% from a year ago and up 12% from January 2021, the company added.
“New vehicle retail sales are expected to be flat for February, which is a good result given the expansive and prolonged nature of the winter storms throughout many parts of the country, including southern states, which do not typically experience snowstorms of this caliber,” said Nick Woolard, Lead Industry Analyst at TrueCar. “At this time, many people are thinking about basic necessities, not purchasing their next vehicle. Those consumers are likely deferring their vehicle purchasing to the end of the month or to March.
“We’re seeing fleet recovery slow down significantly year-over-year. February is typically a big month for fleet sales, but the continued reduction in travel by consumers is delaying fleet recovery,” he continued. “This may be a sign that manufacturers are beginning to triage the ongoing microchip shortage by further pulling back from fleet and reallocating towards retail to help limit inventory shortages.”
Calling Out GM & Toyota
Added Valeri Tompkins, SVP-OEM Solutions at TrueCar, “It’s important to call out GM and Toyota, which are both up year-over-year in retail sales as a result of their strong and diversified lineups with in-demand SUVs and trucks. Toyota has doubled down on their hybrid strategy with the RAV4, Highlander, Sienna, and Venza, while GM continues to successfully produce a variety of popular trucks.
According to TrueCar, average transaction prices (ATP) are projected to be up 6.6% or $2,366 from a year ago and up 1.4% or $518 from January 2021. TrueCar projects that U.S. revenue from new vehicle sales will reach approximately $44 billion for February 2021, down 9.1% (based on a non-adjusted daily selling rate) from a year ago and up 7% from last month.
“As average transaction price continues to increase and inch closer towards the $40,000 mark, incentives continue to trend downward. Based on TrueCar data, incentives are the lowest that we have seen since at least 2017. With inventory still recovering from pandemic-related production pauses and the chip shortage threatening to disrupt production again, incentives will stay low until the recovery is met,” added Tompkins.