U.S. auto sales started off strong in September, as consumers came out in droves during the Labor Day holiday weekend, according to analysis by car-buying guide Edmunds.com. Since then, however, the pace of transactions has fallen as fears of a stunted recovery have kept new-car buyers at bay.
"New car sales for the three-day weekend jumped a remarkable 22% compared to average weekend sales in August, rather than the typical 12% rise," said Ray Zhou, an Edmunds senior analyst. "But as soon as the holiday weekend was over, car-shopping activity fell about 40%."
A quirk in the calendar may be to blame. Labor Day, which falls on the first Monday of September, occurred as late as it possibly could this year, shifting some sales well into September that would have typically been recorded in late August in the run up to the holiday, said Edmunds CEO Jeremy Anwyl in a blog posting.
September sales are on track to record an annual rate of 11.3 million units, after adjusting for seasonal variations, Edmunds said. That's below analyst expectations of a 11.5 million to 12 million rate for the 2010 calendar year. The slower September pace assumes that fleet sales to commercial buyers, such as auto rental companies, will be slightly lower than last month.
Winners so far this month include Toyota Motor (TM) and Nissan Motors (NSANY), with sales rising 9% and 5%, respectively, compared to the first two weeks in August. Others, such as Ford Motor (F), Chrysler Group, and German automakers BMW and Volkswagen have seen sales fall 5% to 10%. Sales at most other automakers are relatively stable, Edmunds said.
The absence of any further holiday-extended weekends in September means automakers will have to rely on incentives to drum up sales, said Edmunds Senior Analyst Jessica Caldwell. "Momentum seems to be lacking whenever the calendar does not reflect a traditional sales period," she said.
Domestic nameplates, including Chevrolet, Ford and Chrysler are among those that are consistently offering the biggest discounts for 2010 model year vehicles, according to a report by online pricing guide TrueCar.com. For 2011 model-year vehicles, Toyota, Chevrolet and Honda Motor (HMC) dealers have given the best deals so far this month, the report said.
Bonds for Beginners
Learn about fixed income investments.View Course »