ARLINGTON, Va.—Total vehicle sales decreased to a rate of 16.4 million annualized units in April, and the decline is expected continue in coming months, said NAFCU Research Assistant Dhruv Singh.
“Automobile sales in April softened, failing to build upon a strong March,” said Singh in a NAFCU Macro Data Flash report. “Lower tax refunds, reduced affordability, and consumer preferences for used vehicles are weighing on sales, which sunk to their lowest level since October 2014. Layoffs in the automotive industry are on the rise as carmakers adjust production levels.
“Consumers are still in a good position with fairly low debt levels and rising real wages, and the Fed is playing its part in backing off of plans for more rate hikes. But the headwinds are prevailing, and NAFCU expects a modest decline in sales volume this year,” Singh added.
Car sales decreased from 5.2 million annualized units to 4.9 million annualized units during the month. Meanwhile, sales of light trucks dropped from 12.2 million annualized units to 11.5 million annualized units.
According to recent survey data from the Federal Reserve Bank of New York, 12.4% of households applied for a car loan within the past 12 months, down from 16.8% a year prior, Singh said.