U.S. auto retail sales for April are expected to be the highest ever recorded for the month, helped by strong consumer demand and tighter inventories at dealerships, industry consultants J.D. Power and LMC Automotive said Wednesday.
Retail sales for new vehicles in April are forecast to reach 1.3 million units, up 111 percent from a year ago as the coronavirus pandemic began to hit the U.S., the firms said.
Total auto sales for April, including fleet, are projected to reach 1.5 million units, a 107 percent increase. The forecasters said they expect the industry’s seasonally adjusted, annualized selling rate to reach 18.1 million, which would be the highest since September 2017.
“With the sales pace exceeding the rate at which vehicles are being produced, compounded by significant production disruption due to microchip shortages, there is a growing risk to the industry’s ability to sustain the current sales pace in the coming months,” Thomas King, president of the data and analytics division at J.D. Power, said in a statement.
TrueCar projects that April sales will be up 97 percent, while Cox Automotive is forecasting a 90 percent gain from April 2020, when sales plunged by nearly half while many dealerships were temporarily closed or had limited operations.
Most automakers that still report monthly sales are scheduled to release their April results Monday, May 3.
Average transaction prices are expected to rise 6.8 percent to $37,572, the highest ever for April, while the average incentive spending per vehicle is expected to fall to $3,191 from $4,953 last year, a 36 percent drop.
King said low inventories “have enabled manufacturers and retailers to reduce discounts,” and consumers were willing to buy vehicles closer to the sticker price and more expensive vehicles.
Reuters and Nick Bunkley of Automotive News contributed to this report.